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

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

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
process management. Manufacturing industries are broadly
categorized into engineering industries, construction
industries, electronics industries, chemical industries, energy
industries, textile industries, food and beverage industries,
metalworking industries, plastic industries, transport and
telecommunication industries.
Manufacturing industries are important for an economy as
they employ a huge share of the labor force and produce
Source: ADB, SDBS Key Economic Indicators
Figure 1 Share of Manufacturing to GDP vs. Other Sector
The employment rate estimated for July 2008 was
92.6 percent. This implies that nine in every 10 persons in
the labor force were employed in July 2008. The current
figure is not significantly different from the July 2007 rate
which is 92.2 percent. The July 2008 LFS also revealed that
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
Long term use
Can work 24 hours
Faster production time
Accurate and more precise
Disadvantages
Breaks down
Needs manpower to operate
High investment costs
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
manpower against machines.
As you can see the diagram shows that
manufacturing is really a big part of the philippine industry.
It comprises 23% of the total GDP of our country.
Manufacturing is using machine and human labor in
converting raw materials into finished goods through a
series of processes. This industry gives job opportunities to
people because of its complex and strenuous processes. It
also contributes a lot in the country’s economy. It is
considered as a wealth-producing sector in the economy.
The Philippines has abundant natural resources.
These resources can be used in manufacturing finished
products that can be sold in and out of the country. It is a
labor- surplus country and labor-intensive industries are
being encouraged by the government. But manufacturing, an
industry which only makes a small contribution to
employment, is still progressive here in the Philippines.
As the years go by, more technologies are being
invented. These technologies are being used in making work
easier, faster and more efficient. Many industries are already
using technologies and they keep on upgrading and
replacing these technologies with new ones. The
Manufacturing Industry is one of the industries that benefits
from these technologies most, which means lesser
employment rate.
4.0 Conclusion
There is really a downward trend in the manufacturing
employment due to the increase of new machineries and
advancement in technologies. It might be an opportunity for
Information Technology graduates but it would greatly
affect the masses. Since the workforce of the Philippines
comprises of Filipinos who did not finished their education.
These people will lose their jobs if they do not adapt to trend
of technology. It is not their fault that they remain to be
factory workers for the rest of their lives since these people
only want to support their families. The government should
be to blame for making Philippines a third-world country.
There would be less demand for factory workers because of
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
government and non-government organizations (NGO)
should help and provide most factory workers with technical
trainings to help them adapt to the trend.
We as students of Information Technology can
create an e-learning website to help teach the factory
workers about handling technology. With cooperation, we
can create a wiki site in which everybody can share
knowledge in handling technology towards the
manufacturing field.
5.0 REFERENCES
[1] Economy Watch, “Manufacturing Industry,”
http://www.economywatch.com/world-
industries/manufacturing/, n.d.
[2] Congressional Planning and Budget Department House
of Representatives, “Facts in Figures,” Congress of the
Philippines,
http://www.congress.gov.ph/download/index.php?d=archive
s
[3] Ericta, Carmelita, “Employment Rate Reported At 92.6
Percent In July 2008,” Press Release,
http://www.census.gov.ph/data/pressrelease/2008/lf0803tx.h
tml, July 2008.
[4] Kidder, David, Kalehoff, Max, Barnett, Jim, & et. al,
“Man Versus Machine: The New Conundrum of Web 2.0
Advertising Automation,” Web 2.0 Expo,
http://www.web2expo.com/webexny2008/public/schedule/d
etail/3699, September 2008
[5] Martin, Samuel, “Maintaining Jobs and Work Through
Machine Automation,” Articlesbase,
http://www.articlesbase.com/business-articles/-maintaining-
jobs-and-work-through-machine-automation-233291.html,
October 2007
[6] Federal Reserve Bank of Cleveland , “Economic
Trends,”
http://www.clevelandfed.org/research/trends/2007/0307/02e
coact_021507-3.gif, March 2007