ADB loan to boost youth employment

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    The Asian Development Bank (ADB) yesterday approved a $400-million policy-based loan to boost youth employment in the Philippines, and hopefully reduce the percentage of young Filipinos who are not in employment, education and training (NEET) to around the regional average by 2022.

    The ADB said yesterday the Facilitating Youth School-to-Work Transition Program, subprogram 2, supports government reforms aimed at improving the employability of young Filipinos through labor market programs and providing easier access to on-the-job training schemes to help them secure and retain jobs.

    The multilateral agency pointed out while some progress has been made in reducing unemployment in the country, with the NEET rate improving from 24.4 percent in 2011 to 21.7 percent in 2017, it is still higher versus the average rate of 18 percent in Southeast Asia and the Pacific.

    “The NEET rate has been declining over time, so it’s a very positive trend. With the program, we anticipate there will be further decline, by five percentage points that is our target, which is aligned also with the Philippine Development Plan. We see that (NEET rate to fall) below 20 percent by 2022,” Cristina Lozano, ADB Southeast Asia senior economist for public finance, said in a press briefing at the ADB office in Manila yesterday.

    “I think the target is, clearly, the lower the better. This program is aiming for below 20 percent,” Kelly Bird, ADB country director for the Philippines, said in the same press conference.

    The multilateral agency said the program builds on its previous support to the government’s employment initiatives, particularly the Department of Labor and Employment’s (DOLE) design and rollout of the Jobstart Philippines Program, a full-cycle youth employment facilitation program that has become law with adequate government funding.

    “Many young Filipinos today are anxious about their career prospects in a very competitive labor market. This program will enhance public employment services to help them transition from school to work,” said Jose Antonio Tan III, director for public management, financial sector and trade at ADB’s Southeast Asia regional department.

    “ADB has a longstanding partnership with the DOLE in youth employment programs. We are committed to helping generate more job opportunities for young Filipinos,” he added.

    The new ADB loan supports government efforts to expand and transform operations of the Public Employment Services Offices in local government units across the country into more professional processes with quality standards, broaden the coverage of the Jobstart Philippines Program, and introduce skills development schemes targeting specific sectors.

    The loan also supports labor policy reforms, such as the introduction of unemployment insurance as part of amendments to the Social Security Act and the Occupational Safety and Health Standards Act, which requires employers to comply with specific workplace standards.

    “This new ADB loan seeks to address the skills mismatch between young job seekers and the competencies demanded by employers. It also strengthens labor regulations to provide income security and decent jobs,” Lozano said.