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The Philippine Labor Index … a work in progress … a progress in work

Bureau of Labor and Employment Statistics. Institute for Labor Studies. ISO 9001:2000 Certified. ILO/UNDP-ILS/BLES PROJECT. The Philippine Labor Index … a work in progress … a progress in work. Contents of Presentation. The Philippine Labor Index and its Uses

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The Philippine Labor Index … a work in progress … a progress in work

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  1. Bureau of Labor and Employment Statistics Institute for Labor Studies ISO 9001:2000 Certified ILO/UNDP-ILS/BLES PROJECT The Philippine Labor Index… a work in progress … a progress in work

  2. Contents of Presentation • The Philippine Labor Index and its Uses • Decent Work and its Dimensions • The PLI Component Indicators • The Methodology for Index Construction • The PLI and its Dimension Indices • Comparisons with Related Development Indicators • Issues and Concerns

  3. The Philippine Labor Index and its Uses

  4. What is the PLI? Philippine Labor Index … is a summary measure that monitors the progress made towards achieving the labor and employment goals of the country.

  5. What are the uses of the PLI? • Provides a balanced and objective assessment of collective efforts to attain the country’s employment goals • Provides useful data for policy-makers on areas that need to be enhanced/ strengthened • Complements other development indicators in monitoring social and economic progress of the working population

  6. What is the basis of the PLI? PLI is based on the ILO Decent Work Framework Decent work is defined as … “opportunities for women and men to obtain decent and productive work, in conditions of freedom, equity, security and human dignity. “

  7. Decent Work and its Dimensions

  8. What are the core objectives of Decent Work? • To achieve universal respect for fundamental principles and rights at work • To create greater employment and income opportunities for women and men • To extend social protection • To promote social dialogue

  9. What are the conceptual dimensions of Decent Work? • Opportunities for work • Freedom of choice of employment • Productive work • Equity in work • Security at work • Dignity at work

  10. The PLI Component Indicators

  11. How were the indicators selected? • series of consultations and workshops • application of statistical tools • conduct of technical sessions

  12. What are the component indicators of each dimension? Opportunities for work • unemployment to local working age population ratio(unemp1) • percentage of wage and salary workers to total employed (employee) • percentage of part-time workers or those working less than 40 hours a week to total employed(less40)

  13. Freedom of Choice of Employment • employment rate of children aged 10-14 years (emp1014) • school attendance rate of children aged 10-17 years (sch1017) • Productive Work • percentage of employed working 40 to 48 hours a week to total employed (emp4048) • visible underemployment rate (visund) • percentage of low-paid employees or those earning below ½ the median hourly basic pay to total employees (bhalfmed)

  14. Equity in Work • female-male ratio in non-agricultural wage employment (fmnagri) • industry-agriculture hourly basic pay ratio (indag) • female-male hourly basic pay ratio for clerical, sales and service occupations (fmcler)

  15. Security at Work • percentage of permanently employed to total employed (permemp) • percentage of workers covered by social security schemes to total self-employed and employees (sshare) • permanently displaced workers due to economic reasons per 1,000 wage and salary workers in private establishments (permdis)

  16. Representation at Work • union density rate for government and private establishments (udens) • collective bargaining coverage rate for private establishments (prvcba) • mandays lost due to strikes and lockouts per employee (mandlost) • percentage of worker association membership to total employed (wamem)

  17. The Methodology for Index Construction

  18. How was the PLI constructed? • Shortfall or gap approach • Use of benchmarks • Determination of dimension and overall indices

  19. Three approaches to constructing the indices were compared: • simple average • shortfall or gap approach • principal components analysis

  20. The study recommends the use of the shortfall or gap approach in computing the index. It was found to be: • flexible • sufficiently simple • appropriate

  21. Benchmarks The following minimum and maximum values were set for each component indicator.

  22. Opportunities for Work

  23. Freedom of Choice of Employment

  24. Productive Work

  25. Equity in Work

  26. Security at Work

  27. Representation at Work

  28. Component Index Value

  29. However, for a negatively oriented indicator, the index value is, where the translated value is the actual value subtracted from 100 (or the sum of the minimum and maximum benchmark values) Translation is done so that all indicators would have uniformly positively orientation.

  30. The Dimension Index Each dimension index is computed byaveraging the component index values of each dimension where Ck is the index value of the component indicator and n is the number of indicators in the dimension

  31. For Equity in Work, a different approach is used to derive the dimension index. It takes the form, where the shortfall value of the component indicator is, where k =1, 2, 3

  32. Philippine Labor Index • The dimensions were categorized into two groups • Opportunities for Work and Freedom of Choice of Employment - concerned with the availability of work and the acceptable scope of work • Productive Work, Equity in Work, Security at Work and Representation at Work - concerned with the extent to which the work is decent or quality of employment • The simple average of the dimension indices of each group was computed and each was assigned a weight of 50% • The PLI is the sum of the weighted indices

  33. Weights used for the PLI

  34. The Philippine Labor Index and its Dimension Indices Note: The indices are unofficial and not for quotation.

  35. Opportunities for Work Note: The definition of unemployment excludes the availability criterion.

  36. Freedom of Choice of Employment

  37. Productive Work a - Excludes data for one indicator.

  38. Equity in Work a - Excludes data for two indicators.

  39. Security at Work r- Revised.

  40. Representation at Work a - Excludes data for one indicator. r - Revised.

  41. The 2001-2002 PLI r- Revised.

  42. Comparisons with Related Development Indicators

  43. Comparisons of GDP Growth, Poverty Incidence, Opportunities for Work Index and Freedom of Choice of Employment, 1999-2004

  44. GDP Growth and Changes in Indices of Opportunities for Work and Freedom of Choice of Employment, 1999-2004

  45. The Philippine Labor Index and the Philippine Human Development Index * The actual value is 0.656. It is expressed in units similar to PLI for comparison purposes.

  46. Issues and Concerns

  47. Issues and Concerns • Interpretation of the indices • Acceptance of the PLI by the stakeholders

  48. Issues and Concerns • Institutionalization of the data collection system • Periodical assessment of the component indicators and the specified limits or benchmarks

  49. Issues and Concerns • Use of the PLI to criticize government performance • Use of the PLI to put down the country in the international arena

  50. Issues and Concerns • Development or construction of labor indices at the regional level for purposes of monitoring the achievements of the regions in the six dimensions of decent work across time • Preparation of Decent Work Status Report

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