* This is my column in BusinessWorld on March 08, 2018.
“It is hard to imagine a more stupid or more dangerous
way of making decisions than by putting those decisions in the hands of people
who pay no price for being wrong.”
— American economist, political philosopher, and author Thomas Sowell
There are many legislative and executive proposals now
that are meant to protect workers but have the long-term effect of discouraging
the hiring of more workers. These five measures seem to stand out.
1. MORE HOLIDAYS WITH PAY
Currently there are 15 national non-working holidays with
pay. Then there are city/municipal non-working holidays proclaimed by local
governments. Plus paid leaves provided for by special laws like solo parent
leave and maternity leave. Plus work suspension with pay during strong
typhoons, floods, and other calamities. Plus work suspensions due to politics
like nationwide jeepney strikes.
Now there are legislative proposals to create new
holidays with pay. Among these are: the last Monday of January as National
Bible Day; and, July 27 as Iglesia ni Cristo anniversary day.
2. PAID MATERNITY LEAVE FROM 60 TO 120 DAYS
A bill called the “Expanded Maternity Leave Law” proposes
to raise the maternity leave period to 120 days or four months. This will cover
all female workers regardless of civil status or legitimacy of the child. Solo
parents would be granted a total of 150 days maternity leave with pay. Fathers
will also enjoy a 30-day leave with pay versus the current seven days of paid
leave as provided for under RA 7322. Penalties for violations are high — fines
up to P20,000, imprisonment for six to 12 years, or both.
3. SECURITY OF TENURE, ENDING ENDO
This is removing the employers’ and contractors’
flexibility to hire workers when demand for work is high. Like catering and
malls, demand for business and labor is high during November and December due
to the Christmas holidays and reunions, then tapers off by January.
4. EVER-RISING MANDATORY MINIMUM WAGE
Even the unskilled should be paid the mandated minimum
wage. The danger of this policy is that the less-skilled or skilled but less
industrious workers will not be hired, raising the unemployment situation in
the country.
5. EXPANDED MATERNAL AND CHILD HEALTH CARE PROGRAMS
Also known as the “Healthy and Bulilit Act” bill, it
seeks to expand the health programs during the child’s first 1,000 days of
life. It would also strengthen the implementation of RA 10028 or the “Expanded
Breastfeeding Promotion Act of 2009.”
These populist and welfarist proposals are based on the
premise that: our employment rate is high and workers can easily find other
jobs, and the health of Filipino mothers and workers are deteriorating. Both
are wrong. Our unemployment rate is the highest in the ASEAN, and Filipinos’
maternal mortality is decreasing although not as low as that of Singapore and
Brunei (see table).
The danger of these proposals is that they make the
hiring of workers, especially female workers and managers, become more
expensive. If this trend continues, less workers will be hired — only the very
talented, very efficient ones will be hired and the rest will be working in the
informal, less well-paid sector or will be begging for more subsidies and cash
transfers from the government.
And more workers doing repetitive jobs will be replaced
by machines, robots, and artificial intelligence (AI). Machines do not ask for
holidays with pay or maternity/paternity leaves with pay, and consumers want
cheaper goods and services from shops and manufacturing plants.
Employment is not a right or entitlement. It is a
privilege for those who have clear ambitions, personal responsibility, and
equip themselves with certain skills. Entrepreneurship and being in business is
also not a right or entitlement. It is a privilege for those who have deep
patience and efficiency to understand both the consumers and suppliers of various
production inputs, plus some luck. And the patience to deal with bureaucracies
and politicians with very fickle and populist mind-sets.
Employment is a private contract between employers and
would-be employees. If the terms are bad for job seekers, they should have more
options for other employers. Better yet, employ themselves via
micro-entrepreneurship or small start-up businesses.
Government should step back from setting and dictating
the terms of employment and focus on enforcement of contracts. Government
should also de-bureaucratize business and entrepreneurship so that more workers
can migrate to become employers someday more easily.
----------------
See also:
BWorld 191, Solar insecurity, energy stability and affordability, March 15, 2018
BWorld 192, Cobalt mining and TRAIN, March 16, 2018
BWorld 193, TRAIN, inflation and emerging DOE price control, March 16, 2018
BWorld 193, TRAIN, inflation and emerging DOE price control, March 16, 2018
No comments:
Post a Comment