Measuring the Informal Sector in the Philippines
and the Trends in Asia
Dean Jorge V. Sibal
University of the Philippines
School of Labour and Industrial Relations
Paper Abstract
The paper’s findings show that the informal sector in the Philippines which is composed of unpaid family workers and own-account workers has declined. This is due to the increasing number of non-regular (or contractual) workers in the formal sector of the economy which has been employing workers from the informal sector. This trend, called “informalization of labour” was observed in many developing and transitioning economies in Asia and has contributed to the increasing income inequity between the informal and formal sectors.
The paper is composed of two parts. The first part cites the definition of the informal sector in the Philippines and compares it with the definition of the International Labour Organization (ILO). It describes and cites data on the informal sector in the Philippines based on several surveys and researches. The traditional members of the informal sector (own account workers and unpaid family workers) have declined from 58 per cent of the employed labour force in 1980 to 50 per cent in 2005
The second part shows that the percentage decline of workers in the informal sector was due to the absorption of its members in the formal sector as non-regular or contractual workers. Dubbed as “informalization of labour”, the total number of informal sector workers and the non-regular workers hired locally or overseas shows an increasing trend as experienced in the Asia and the Pacific region.
The paper concludes that the informal sector serves as a source of cheap labour for non-regular employment. Both the informal and non-regular workers earn less than the formal sector workers, thus increasing further the income inequity between the informal and formal sectors.
The paper recommends an alternative approach to reverse the race-to-the bottom wage trends by a continuous monitoring and measuring of the condition of workers especially in the informal sector, skills upgrading of all workers in the formal and informal sectors for labour flexibility and productivity, and the advocacy and implementation of social compliance standards at the workplace. Social compliance in the workplace can be achieved through various modes- from the compulsory state legislations to the voluntary industry accords, promotion of good practices and continuous improvement in the workplace.
Brief Bio-Data of
PROF. JORGE V. SIBAL
¨ Professor 6 & Dean, UP SOLAIR, 2005-2011
UP School of Labor and Industrial Relations (SOLAIR), Diliman, Quezon City
¨ BSBA ‘71, Dip. in IR ‘79, MIR ’82, UP Diliman
¨ National Expert, Asian Productivity Organization (APO), Tokyo, Japan
¨ Contract Researcher, International Labor Organization (ILO), Geneva and AKI, DLSU, Manila
¨ Social Compliance Associate, ECOP, ILO and Verite
¨ Director (2004-05), President (2002-03), Nikkeiren Alumni Association
¨ Secretary, Phil. Industrial Relations Society (PIRS)
¨ Licensed real estate broker & Director, Sibal Realty and Development Corporation
¨ Vice Chair & Trustee, Urban Missionaries Foundation, Inc., 2002-2009
¨ Co-Convenor, Fair Trade Alliance (FTA)
¨ Trustee and Secretary, Philippine Employer and Labor Social Partners, Inc.
Books Authored
· Human Resource Development, Industrial Relations and Management in the Philippine Setting: A Guidebook, 2008
· Philippine Labor and the Economy, 2008
· Changes and Challenges: 60 Years of Struggle Towards decent Work, 2008 (Editor)
Formerly-
¨ Affiliate Professor: UP Cebu, School of Management, UP Mindanao, Davao City; and Management Sciences Div., UP College Baguio
¨ Director, UP SOLAIR Center for Labor & Grassroots Initiatives (CLGI),
2002 Gawad Chanselor awardee for “Best Extension Program”
¨ Coordinator, UP SOLAIR Labor Education & Ext’n. Program (LEEP), 1996 Sikap-Gawa Industrial Peace awardee for training and research by the Bishops-Businessmen’s Conference for Human Development & 1996 Gawad Chanselor awardee for "Pinakamahusay na Pahinungod”
¨ Senior Lecturer, MBA Program, UP College of Business Administration
¨ Professor, Graduate Studies in Business and Economics (GSBE) Program, De la Salle University, Manila & MBA/MPA Program, Philippine Women’s University
¨ Director, Sports Development, Quezon City Government
¨ Consultant, Vice Mayor’s Office, Quezon City
¨ Marketing Consultant, Real Estate Exchange, Inc., Makati
¨ Personnel and Administrative Manager, Black Mountain, Inc., Makati
¨ Project Manager, Bancom Realty Corporation, Makati
¨ Account Manager, J. Walter Thompson Co. Ltd. (Mla.), Manila
¨ President, UP IR Alumni Association-UPAA Chapter
Address:
Bonifacio Hall, UP SOLAIR, Diliman, Q.C., Philippines 1101
Tel-Fax- 9207717, Cell # 0917 6076233, Tel-Res. 411-9226,
E-mail- website: http://www.freewebs.com/jorge_sibal