A large pool of young workers will support economic growth in the next few years, Bangko Sentral Governor Amando Tetangco Jr. said Wednesday.
Tetangco said in a speech before the Philippine Investment Forum the country’s large population of young workers with purchasing power provides the economy with the so-called demographic dividends that are good for consumption and investments.
He said the Philippines would enter the demographic sweet spot by 2015. “Population would be a source of economic growth,” he said, adding that the concept of demographic dividends has been proven historically.
“That concept, the demographic window, is that period in an economy’s history where more people or a prominent portion of the population is of working age. That means these people have the purchasing power, purchasing capacity, which can drive consumption, investment and therefore faster economy,” said Tetangco.
“Our average age is 22.2 years. So by 2015, we’ll reach that window. We’ve seen the experience of other countries — Thailand and Indonesia—in the region that have benefited from these demographic dividends,” said Tetangco.
He said the Philippines would be the last major economy in Asia to enter the so-called demographic sweet spot. “If you’re an investor and you’re looking at the potential of an economy in terms of the size of the market, they will consider these demographic window that the Philippines is about to enter,” said Tetangco.
Tetangco noted that nearly half a million graduates enter the labor force each year, providing companies with a big pool of manpower to fill their requirements.
“If the economy is growing, underlying that growth would be the increase of employment as well. So as you grow, you can generate more employment and therefore you can have more people employed who are able to spend and help fuel growth in the economy,” said Tetangco.
(Published in the Manila Standard Today newspaper on /2012/March/29)
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