THE record-high unemployment rate does not show the real picture of the economy and the job market, Bangko Sentral ng Pilipinas Governor Benjamin E. Diokno said.

“The increase in unemployment does not reflect the true state of the economy and the jobs market. It was more a result of the policy decision to save lives in response to the COVID-19 (coronavirus disease 2019) pandemic,” Mr. Diokno told reporters in a Viber message on Saturday.

The jobless rate in the country soared to 17.7% in April, the highest since the Philippines adopted new definitions for the survey and was much higher than the 5.1% recorded a year earlier.

Mr. Diokno said the survey was conducted from April 20 to May 16, which was at the height of the enhanced community quarantine (ECQ) in Luzon. Lockdown measures were imposed in mid-March to prevent further spread of the virus, causing many business operations to temporarily shut down. Restrictions were gradually lifted for some areas starting May.

Although the BSP is not in the position to directly address unemployment, Mr. Diokno said the central bank’s “timely, proactive, and decisive” monetary actions at the onset of the pandemic will work to lift confidence in the market and “avert further damage in the economy.”

“We, therefore, reiterate our support for carefully coordinated actions with other government authorities as well as pending stimulus bills in Congress aimed at responding to the evolving needs of the economy as it transitions into new economic realities amid the ongoing pandemic,” Mr. Diokno said.

The rise in the jobless rate was “expected,” and even be worse since many workers in the informal sector and overseas Filipino workers (OFWs) have also lost their jobs, said UnionBank of the Philippines Chief Economist Ruben Carlo O. Asuncion.

Data from the Department of Foreign Affairs showed that repatriated OFWs reached more than 36,000 as of June 6.

“Basic sources of income of people are largely affected. This may impact poverty incidence and may cause it to grow higher,” Mr. Asuncion said in a text message.

The increase in the underemployment rate is also worrisome, according to ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa.

Underemployed Filipinos — those already working but still looking for more work — also rose to 6.39 million from 5.61 million a year earlier, pushing the underemployment rate to 18.9% from 13.4%.

“Some companies have opted to furlough a portion of their staff, which means that they are technically still employed but will no longer receive a salary,” he said.

Mr. Mapa said all this will create a domino effect as no salary will mean no consumption, and no consumption will lead to no growth.

Private consumption is a vital facet of the economy as it accounts for 70% of the country’s gross domestic product (GDP). As the pandemic lingers, economic managers have said GDP is likely to shrink by 2-3.2% in 2020, with the economy contracting by 0.2% in the first quarter.

“Now that COVID-19 has ran roughshod through the Philippine economy and leveled all its past “economic fundamental” grandeur, we realize what held together the magical growth run of the Philippine economy: jobs,” Mr. Mapa said.

Mr. Asuncion expressed hope the gradual lifting of restriction measures will somehow lift the job market by the next labor force survey expected to be reported by August.

“[B]y then, the economy may have adjusted to the “new normal.” Barring any high resurgence or infections needing a serious lockdown, some firms may continue their business with ample help from the government,” he said. — Luz Wendy T. Noble

RELATED ARTICLESMORE FROM AUTHOR