STATE OF TALENT SUPPLY AND DEMAND IN THE PHILIPPINES

For much of the last 40 years, the Philippines has been gearing its national economy towards industrial and technological pursuits; and with this, demanding that the labor force transform from being primarily rural and agrarian to increasingly urban and industrial. Employers are also increasingly requiring professionals with the appropriate skills set, which local educational institutions have failed to supply. Recruiters, such as business process outsourcing (BPO) firms, are concerned that Philippine college and university graduates who enter the workforce are inadequately prepared, as exemplified by the low English proficiency levels, stated by the Universal Access to Competitiveness and Trade (UACT), and poor communication skills and critical thinking. Back in 1997, an analysis on the state of human resources in Southeast Asia showed that the Philippines, contrary to Indonesia, Malaysia and China, was facing an employment surplus rather than a shortage. Amidst the economic growth, employment opportunities were not sufficient for the relatively well-educated workforce. Unemployment and emigration of professional workers was prevalent. Professionals prefer to be overseas workers in developed countries because of higher salaries and better employment opportunities. However, at the turn of the millennium, educational systems can no longer produce enough highly trained workers to fill the positions created by rapid economic growth and shifting economic goals. Statistically speaking, the National Statistical Coordination Board (NSBC) revealed that although the number of graduates has been generally increasing, the ratio of graduates to enrolees stands only at 16% to less than 18% and a 0.08% negative growth during the Academic Year (AY) 2004-2005. Also, enrolment in vocational courses has skyrocketed to 116.6% in AY 2002-2003 due to the introduction of the Technical Vocational Education and Training (TVET), however, followed by a drop in 2004-2005, but has increased significantly thereafter by a factor of 14% and 25% in AY 2004-2005 and AY 2005-2006, respectively. The Filipino youth seem to opt for vocational rather than a college or university degree, primarily due to financial and time constraints. Similarly, the survival rate of students in vocational courses is higher by 68.6% than in college or university degree programs. Furthermore, educational institutions have restructured their course offerings in order to give way to more marketable and in demand courses such as medical and allied courses, namely nursing, and dissolved unpopular courses such as philosophy. The increasing matriculation fees of tertiary education and restructuring of tertiary educational institutions has resulted to a mismatch of talent supply and demand in the Philippines. Lesser high school graduates proceed to earn a degree and even lesser get to graduate, thus, further limiting the pool of Philippine college and university graduates that can be chosen from. While highly industrialized multinational companies require highly engaged, skilled and productive workforces, 50% of the nations employment force is composed of unskilled labor workers and farmers. The remaining 50% is subdivided among managers and supervisors, service workers and shop and market sales workers, traders and related workers, and plant machine operators and assemblers. The present state of our educational,

economic and technological development is not cognizant of the highly specific and technical jobs that the emerging global economy presents. While recruitment challenges are nothing new, employers have greater difficulties attracting and retaining the required workforce because the talent supply and talent demand gap is growing. Firms that aspire to hire skilled professionals have three alternatives: (1) hire local; (2) hire returnees; and (3) hire expatriates. Local employees are recruited via classified ads placed in newspapers or in job fairs. Inadequate number of skilled hires obliges firms to provide on the job trainings, however, due to competitive employers, the possibility of industrial poaching, wherein well-equipped workers are bribed by another firm via higher wages and better benefits. The repercussions of such actuations reverberate further into the economy by causing wage inflation and encouraging unreasonable expectations from employees in terms of benefits. Hiring returnees and expatriates is also another strategy to acquire skilled professionals. Nationals who have overseas experience are familiar with both Western and local business practices. Language barrier, housing and visa requirements are also not a problem for returnees. Expatriates or foreign nationals, on the other hand, are affected by more stringent restrictions such as visa requirements and higher income taxes. Both returnees and expatriates require way higher salaries than local employees and often demand for greater benefits. Having established the increasing gap between talent demand and talent supply, the question now is: what can we do? University grounds are prime recruitment sites for companies. Establishing a sustainable partnership between the industry and the academe could result to an environment within university and college campuses that is conducive for talent development. Curriculum designs could be modified to suit the varying demands of the industry. Furthermore, with greater access to the campuses, on-site marketing can be done strategically, drawing in talents, who have the skill, yet hesitate to join the local workforce. In achieving this goal, the students attitudes towards entry-level jobs and overseas jobs should be changed maybe via workshops and seminars sponsored by the firms. Bridging the gap between the educational system and employment market would require the cooperation and collaboration of the industry, government agencies and educational institutions. The main goals of the collaboration should be to draw in talent into the national industry and establish a partnership of the industry and the academe.