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EMPLOYMENT RATES IN MANUFACTURING INTDUSTRY

Chong, Dino Bryan S15


chonggy27@yahoo.com
Cunanan, Katryne Nicole S15
kae_c13@yahoo.com
Sison, Florence Andrea S15
oyeng_8@yahoo.com
So, Jenny Lyn S15
jennyso_37@yahoo.com

College of Computer Studies


Bachelor of Science in Information and Communications Technology Management

ABSTRACT materials required by sectors of strategic importance such as


national infrastructure and defense. However, not all
Manufacturing is transforming raw materials to finished manufacturing industries are beneficial to the nation as some
goods with the use of machines, tools and labor. Since of them generate negative externalities with huge social
technology is evolving very fast, new machines are being costs. [1]
introduced to the Manufacturing Industry. The main issue in
this situation is whether these technologies might replace 2.0 BACKGROUND
human labor in the manufacturing industry. Are machines
better than humans? Why does the manufacturing industry Manufacturing accounts for roughly 71% on the average of
invest on these machineries? What are the advantages of industry output and 24.6% of gross domestic product (GDP)
working with these technologies? And what are the for the period 1986-2007. The share of manufacturing to
disadvantages of using these machineries? By tackling these GDP peaked at 29% in 1974 before eventually bottoming
questions, it can help in answering whether this issue is out to 23% in 2007. Further, the ratio of manufacturing to
really happening in manufacturing industry especially here GDP is higher than that of the agriculture sector. [2]
in the Philippines.

1.0 INTRODUCTION

In general, Manufacturing Industry refers to those industries


which are involved in the manufacturing and processing of
items and indulge in either creation of new commodities or
in value addition. Currently, Manufacturing Industry
accounts for a significant share of the industrial sector in
developed countries.

Manufacturing industries are the major wealth producing


sectors of an economy. These industries use various
technologies and methods widely known as manufacturing Source: ADB, SDBS Key Economic Indicators
process management. Manufacturing industries are broadly
categorized into engineering industries, construction Figure 1 Share of Manufacturing to GDP vs. Other Sector
industries, electronics industries, chemical industries, energy
industries, textile industries, food and beverage industries, The employment rate estimated for July 2008 was
metalworking industries, plastic industries, transport and 92.6 percent. This implies that nine in every 10 persons in
telecommunication industries. the labor force were employed in July 2008. The current
figure is not significantly different from the July 2007 rate
Manufacturing industries are important for an economy as which is 92.2 percent. The July 2008 LFS also revealed that
they employ a huge share of the labor force and produce the labor force participation rate is 64.3 percent. This means
that the size of the labor force in July 2008 was Our research showed that the workforce in the
approximately 37.3 million out of the estimated 58.1 million manufacturing industry comprises of about 5 million
population 15 years and older for that period. Compared to Filipino workers. The advancement in technologies might
the labor force participation rate in July 2007 (63.6%), the affect the lives of these people since a lot of companies now
July 2008 rate is higher. are investing in machines to replace manpower. The reason
for the downward trend in the manufacturing employment is
Philippines July July due to the increase of electric machinery. The main reason
2008 1/ 2007 for this transition is that machines have the ability to do
Total 15 years old and 58,119 56,857 work continuously without resting and complaining. They
over (in '000) are more accurate and the production time faster. The
Labor Force Participation 64.3 63.6 slower growth is attributed mostly to electric machinery.
Rate (%)
Employment Rate (%) 92.6 92.2 Are machines better than humans?
Unemployment Rate (%) 7.4 7.8
Underemployment Rate 21.0 22.0 No, since humans are the ones who invent and
(%)
Notes: 1/
Estimates for July 2008 are preliminary and may change.
create the machine to be used. We only develop a machine
2/
Population 15 years and over is from the 2000 Census-based population to help and lessen our workload. In the end the machine
projections. cannot operate without the help of humans. There are
Source: NSO
aspects in which the products produced by the machine are
Table 1 Employment Rate in July 2008 more consistent than manpower, since machines are more
accurate and repetitive of its actions and process. But the
More than half (50.2%) of the total employed machines cannot replace the beauty and elegance of hand
persons in July 2008, which was estimated at 34.6 million, made products which is more valuable in price and quality.
worked in the services sector, with those engaged in
wholesale and retail trade, repair of motor vehicles, Why does the manufacturing industry invest on these
motorcycles and personal and household goods comprising machineries?
the largest sub-sector (19.1% of the total employed).
Workers in the agriculture sector comprised 35.0 percent of The manufacturing industry invests in machine
the total employed, with workers in agriculture, hunting technologies to become adaptable and competitive in the
and forestry making up the largest sub-sector (30.9% of the industry. These companies which invest in machines are
total employed). Only 14.8 percent of the total employed aiming for long term benefits, since the machine can
were in the industry sector, with the manufacturing sub- work/stay longer than the employee unless the machine
sector making up the largest percentage (8.5% of the total breaks down. The effect of acquiring technological
employed). [3] machines would be long term savings and faster production
time.
3.0 ISSUES
Advantages and Disadvantages of Machine

Advantages Disadvantages
Long term use Breaks down
Can work 24 hours Needs manpower to operate
Faster production time High investment costs
Accurate and more precise Cannot decide on its own

Advantages and Disadvantages of manpower

Advantages Disadvantages
Adds employment to the Attitude problems
country (tardiness, absenteeism,
laziness)
Better hand-made products Limit in working
capabilities
Source: Bureu of Economic Analysis; Bureu of Labor Statistics Human judgment Gets Sick
Faster to acquire Harder to manage
Figure 2 Real Manufacturing Output and Employment
The data above shows the pros and cons of government and non-government organizations (NGO)
manpower against machines. should help and provide most factory workers with technical
trainings to help them adapt to the trend.
As you can see the diagram shows that
manufacturing is really a big part of the philippine industry. We as students of Information Technology can
It comprises 23% of the total GDP of our country. create an e-learning website to help teach the factory
Manufacturing is using machine and human labor in workers about handling technology. With cooperation, we
converting raw materials into finished goods through a can create a wiki site in which everybody can share
series of processes. This industry gives job opportunities to knowledge in handling technology towards the
people because of its complex and strenuous processes. It manufacturing field.
also contributes a lot in the country’s economy. It is
considered as a wealth-producing sector in the economy. 5.0 REFERENCES

The Philippines has abundant natural resources. [1] Economy Watch, “Manufacturing Industry,”
These resources can be used in manufacturing finished http://www.economywatch.com/world-
products that can be sold in and out of the country. It is a industries/manufacturing/, n.d.
labor- surplus country and labor-intensive industries are
being encouraged by the government. But manufacturing, an [2] Congressional Planning and Budget Department House
industry which only makes a small contribution to of Representatives, “Facts in Figures,” Congress of the
employment, is still progressive here in the Philippines. Philippines,
http://www.congress.gov.ph/download/index.php?d=archive
As the years go by, more technologies are being s
invented. These technologies are being used in making work
easier, faster and more efficient. Many industries are already [3] Ericta, Carmelita, “Employment Rate Reported At 92.6
using technologies and they keep on upgrading and Percent In July 2008,” Press Release,
replacing these technologies with new ones. The http://www.census.gov.ph/data/pressrelease/2008/lf0803tx.h
Manufacturing Industry is one of the industries that benefits tml, July 2008.
from these technologies most, which means lesser
employment rate. [4] Kidder, David, Kalehoff, Max, Barnett, Jim, & et. al,
“Man Versus Machine: The New Conundrum of Web 2.0
4.0 Conclusion Advertising Automation,” Web 2.0 Expo,
http://www.web2expo.com/webexny2008/public/schedule/d
There is really a downward trend in the manufacturing etail/3699, September 2008
employment due to the increase of new machineries and
advancement in technologies. It might be an opportunity for [5] Martin, Samuel, “Maintaining Jobs and Work Through
Information Technology graduates but it would greatly Machine Automation,” Articlesbase,
affect the masses. Since the workforce of the Philippines http://www.articlesbase.com/business-articles/-maintaining-
comprises of Filipinos who did not finished their education. jobs-and-work-through-machine-automation-233291.html,
These people will lose their jobs if they do not adapt to trend October 2007
of technology. It is not their fault that they remain to be
factory workers for the rest of their lives since these people [6] Federal Reserve Bank of Cleveland , “Economic
only want to support their families. The government should Trends,”
be to blame for making Philippines a third-world country. http://www.clevelandfed.org/research/trends/2007/0307/02e
There would be less demand for factory workers because of coact_021507-3.gif, March 2007
the widely available machines that not only makes
production of goods faster, but at times even better. This
issue can be resolved by giving free seminars and trainings
to the workers on how to use different technological
advancements in the manufacturing industry supported by
the government. There is always hope and this ethical issue
can be solved by cooperating with the government.

Though the phenomena of robotics and automation


in the industry will be an ongoing technology trend,
manufacturing jobs should not stay still. The nature of these
jobs will also follow the technology trend. In result, the