by Mark Edward V. Tayao
Unemployment among the youth in the Philippines is an outgrowth of limited access to education, from the year 2003 to 2004 it grew to a 1.2 percent change of unemployment rate, from the year 2004 to 2005 it grew again from 11.4 percent to 11.70 percent (Philippines Unemployment rate), according to Dr. Carolina Guerrero, director of the Bureau of Alternative Learning System. “We have what we call the Club 86. There is an average of 100 entrants in the first grade in the country, but out of these 100, only 14 will get a college degree. What happened to the other 86? They are all dropouts, part of Club 86,” she said. There is indeed structural unemployment in the country as indicated by the continuous increase in the number of unemployed, the number of graduates from degree and technical-vocational courses, and the number of job vacancies being posted in the newspapers, radio programs, and in the Internet It identifies the following factors that contribute to the mismatch: Philippine education and training institutions are plague with problems such as over-subscription of certain courses, particularly business courses, and under-subscription in certain priority courses; low survival/graduation rate; and low performance in licensure examinations; The tendency of the industrial sector to be selective in their hiring practices, which delimits the opportunities of most graduates in finding better careers that pay well; The prevalent practice among graduates to proceed to graduate school after college believing that no work is available anyway, which makes them a candidate for the pool of educated unemployed; and Underutilization of career guidance counseling, resulting to students’ deprivation on information regarding skills, courses or specialization required by industries, which consequently leads them to take courses considered as over-subscribed. But new initiatives in corporate social responsibility (CSR) aim to stop the numbers from growing.
One of these is an automotive training center funded by Isuzu Motors Limited Japan and another is Ashoka, a global group of social innovator. The Isuzu Motors Japan will finance the expansion of the center in Tacloban managed by the technical Education and skills Development Authority or also known as TESDA, to produce qualified technicians. For the Ashoka group they are starting to introduce the ‘alternative profession’ of social entrepreneurship to students.
According to Keiji Takeda, President of the Isuzu Philippines Corporation, their company will allot $3 million over a five-year span, help in shaping the curriculum and supply training equipment to the center. Isuzu Motors linked arms with Plan Philippines, a humanitarian organization for children, in establishing the center, which will be home to 80 deserving young men and women.
Scholars will be chosen from Plan-assisted communities in the country, which include Occidental Mindoro, Masbate, Samar, Southern Leyte and Camotes Island in Visayas. Plan Philippines and TESDA are yet to set the criteria for the selection of trainees, but primary consideration would be given to those from poor areas. Trainees will undertake a six-month program and graduate with a National Certification IV, the highest qualifying degree for vocational courses. While Isuzu Motors does not require the scholars to work for them after completing the program, Takeda said that the company would ‘definitely’ open its doors to them. On the other hand, Plan Philippines will also network with industry firms to ensure jobs for the center’s graduates.
When asked why they decided to focus their CSR on education, Takeda said that they conducted a survey among their employees and asked them what kind of help the Philippines needs. “The employees said that Filipinos should be given the opportunity to study so that they could have jobs. Isuzu Motors will give them that opportunity through the training center,” he explained.
Social entrepreneurship, which uses business skills in solving social problems, appears unattractive for young people who need money. But Steve Koon, professor of social entrepreneurship at the Kennedy School of Government in Harvard University, pointed out in a recent forum that social entrepreneurs do not only get money, they also gain meaning and a sense of fulfillment in what they are doing.
Koon added that social entrepreneurs have a higher chance of sticking to their ‘work’ than 8-5 employees. “At the end of the day, it all boils down to happiness. Are you happy with what you are doing? More often than not, I will hear from corporate people that they are not. Why? It’s because money alone cannot make you happy,” he said.
Wednesday, March 24, 2010
Friday, February 27, 2009
STOCK MARKET DEVELOPMENT AND THE PHILIPPINE ECONOMY
Maria Karla L. Mendez, Agapito P. Raymundo IV, Patrick M. Tinoco
B.S. Marketing and Corporate Communications S.Y. 08-09
San Beda College, Mendiola, Manila, Philippines
Stock Market made an impulse on the headlines of news and online articles these days. This captured attention because of recent occurrence in the behavior of stock markets in the world. Hence, this rationalizes that every individual should be well-informed on what’s happening on our unpredictable economy. But first, what is a stock and a stock market? A stock represents ownership in a company. Therefore when you purchase stock, you become part owner of the company. A stock is sold in the stock market, or also called equity market, wherein it is considered as an economic indicator which is responsible for the trading of company stock at an agreed price. Stock Market is one of the most important sources for companies to raise money therefore it gives companies the tendency of expanding its business dimension. Other than the stock market being important for its function and purpose for companies, is it also important for the growth of an economy (specifically to a less developed country) like Philippines? This topic is one of the most questionable and enduring debates in economics. Generally, this article will provide a conclusion for this very interesting question: “Does the development in stock market promote growth in the Philippine economy?”
There are many economic indicators that affect the performance of the stock market. These are Interest rates, foreign exchange, inflation and growth rates. Favorable growth and inflation rates as well as stabilized interest rates and foreign exchange are good news for the stock market. They usually give a kick on the market performance as these indicate sound economic status. Soaring interest rates, on the other hand, usually pushes investors from the stock market to some interest-bearing investments, as they offer better returns than stock investing. (Pioneer Junior College)
Stock Market Generalization
Stock market can be generalized in a statement. “Stock market is considered as an economic indicator which is responsible for the trading of company stock and derivatives of company stock at an agreed price. If there is a great increase in stock prices or the stock market condition is bullish, the stock owners feel wealthier and for that they respond by increasing their spending which makes them more confident in investing more on the stock market. Therefore, the capitalization of the companies in a stock market is increased and giving these companies, the tendency of expanding its business dimension. Resulting from business/company expansion, more employment would be available for the people and business productivity is also increased. Thus, employment and productivity growth carry out economic stability and economic growth as follows. Of course, sharp declines in stock prices would produce the opposite results.”
Stock Market-Economic Growth Relationship
In accordance to the relationship between the stock market and economic growth, basic aspects in determining economic growth are also discussed. GDP (Gross Domestic Product) is used as the main measurement of economic growth. A development in the stock market results to an improved economic performance of the Philippines because such positive changes (whether the rate of growth only ranges from 3-4 percent) is greatly accompanied by the increase and/or growth of the Philippine economy. For poor countries and less developed countries like Philippines, even a one-half or a 0.5 percent point in the rate of growth may mean the difference between starvation and mere hunger. While for such countries like U.S., for example, if their current real GDP is about $10.5 trillion, a 3-4% growth rate will give an additional $105 billion of output each year for the U.S. (Mc Connell, 2005)
Furthermore, the development of the stock market gave an increase in the average monthly trading value that encouraged the entry of portfolio investors in the Philippines (last 2005) which is a good sign for the economy. These factors give investors more confidence to invest in the Philippine stock market and also give chances for businesses/companies in our country to expand its business dimensions.
Investments greatly contribute to the expansion of companies and businesses. Therefore, investments are also a factor in the increase in the Four Factors of Production which yields additional output for the economy. In line with this, stock market development indirectly promotes economic growth through reducing unemployment and on the other hand increases productivity of an economy which leads to economic stability that results to economic growth.
Unemployment is one of the two major problems that arise in the business cycle and it is a good thing that through stock market development it can lessen the burden of recession of an economy. In relation to the present status of the Philippine economy, unemployment is the number one problem of our country today because obviously many businesses and even big multi-national companies had shut down and stopped operating. One reason would be the lack of investments either locally or in foreign countries. This is also connected to an investor’s confidence to invest because the economic performance of the Philippines last year was really depressing and very weak.
Moreover, productivity of investments is the channel through which stock market development enhances the growth rate in the long run. For that reason, Stock market development promotes economic growth because it helps in increasing a society’s real output and income through investment productivity which results to a great portion of the betterment and improvement of the inputs of the economy.
Due to such benefits and advantages of the stock market development to an economy, stock market development can give a big boost to the economic development of our country, thus resulting to economic growth.
B.S. Marketing and Corporate Communications S.Y. 08-09
San Beda College, Mendiola, Manila, Philippines
Stock Market made an impulse on the headlines of news and online articles these days. This captured attention because of recent occurrence in the behavior of stock markets in the world. Hence, this rationalizes that every individual should be well-informed on what’s happening on our unpredictable economy. But first, what is a stock and a stock market? A stock represents ownership in a company. Therefore when you purchase stock, you become part owner of the company. A stock is sold in the stock market, or also called equity market, wherein it is considered as an economic indicator which is responsible for the trading of company stock at an agreed price. Stock Market is one of the most important sources for companies to raise money therefore it gives companies the tendency of expanding its business dimension. Other than the stock market being important for its function and purpose for companies, is it also important for the growth of an economy (specifically to a less developed country) like Philippines? This topic is one of the most questionable and enduring debates in economics. Generally, this article will provide a conclusion for this very interesting question: “Does the development in stock market promote growth in the Philippine economy?”
There are many economic indicators that affect the performance of the stock market. These are Interest rates, foreign exchange, inflation and growth rates. Favorable growth and inflation rates as well as stabilized interest rates and foreign exchange are good news for the stock market. They usually give a kick on the market performance as these indicate sound economic status. Soaring interest rates, on the other hand, usually pushes investors from the stock market to some interest-bearing investments, as they offer better returns than stock investing. (Pioneer Junior College)
Stock Market Generalization
Stock market can be generalized in a statement. “Stock market is considered as an economic indicator which is responsible for the trading of company stock and derivatives of company stock at an agreed price. If there is a great increase in stock prices or the stock market condition is bullish, the stock owners feel wealthier and for that they respond by increasing their spending which makes them more confident in investing more on the stock market. Therefore, the capitalization of the companies in a stock market is increased and giving these companies, the tendency of expanding its business dimension. Resulting from business/company expansion, more employment would be available for the people and business productivity is also increased. Thus, employment and productivity growth carry out economic stability and economic growth as follows. Of course, sharp declines in stock prices would produce the opposite results.”
Stock Market-Economic Growth Relationship
In accordance to the relationship between the stock market and economic growth, basic aspects in determining economic growth are also discussed. GDP (Gross Domestic Product) is used as the main measurement of economic growth. A development in the stock market results to an improved economic performance of the Philippines because such positive changes (whether the rate of growth only ranges from 3-4 percent) is greatly accompanied by the increase and/or growth of the Philippine economy. For poor countries and less developed countries like Philippines, even a one-half or a 0.5 percent point in the rate of growth may mean the difference between starvation and mere hunger. While for such countries like U.S., for example, if their current real GDP is about $10.5 trillion, a 3-4% growth rate will give an additional $105 billion of output each year for the U.S. (Mc Connell, 2005)
Furthermore, the development of the stock market gave an increase in the average monthly trading value that encouraged the entry of portfolio investors in the Philippines (last 2005) which is a good sign for the economy. These factors give investors more confidence to invest in the Philippine stock market and also give chances for businesses/companies in our country to expand its business dimensions.
Investments greatly contribute to the expansion of companies and businesses. Therefore, investments are also a factor in the increase in the Four Factors of Production which yields additional output for the economy. In line with this, stock market development indirectly promotes economic growth through reducing unemployment and on the other hand increases productivity of an economy which leads to economic stability that results to economic growth.
Unemployment is one of the two major problems that arise in the business cycle and it is a good thing that through stock market development it can lessen the burden of recession of an economy. In relation to the present status of the Philippine economy, unemployment is the number one problem of our country today because obviously many businesses and even big multi-national companies had shut down and stopped operating. One reason would be the lack of investments either locally or in foreign countries. This is also connected to an investor’s confidence to invest because the economic performance of the Philippines last year was really depressing and very weak.
Moreover, productivity of investments is the channel through which stock market development enhances the growth rate in the long run. For that reason, Stock market development promotes economic growth because it helps in increasing a society’s real output and income through investment productivity which results to a great portion of the betterment and improvement of the inputs of the economy.
Due to such benefits and advantages of the stock market development to an economy, stock market development can give a big boost to the economic development of our country, thus resulting to economic growth.
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