18 September 2014

Personal optimism slightly up

OPTIMISM among Filipinos about their personal prospects has risen slightly, the Social Weather Stations (SWS) said, even with less saying that their lives have improved over the past year and that the economy would fare better.

A June 27-30 nationwide survey conducted by SWS found 39% of respondents expecting the quality of their lives to improve in the next 12 months (optimists), compared to the 8% who said otherwise (pessimists). This put net personal optimism score -- or the difference of optimists over pessimists -- at a “very high” +31.

The quarter’s result is an upgrade from the “high” +29 score -- 38% optimists and 9% pessimists -- recorded in a March 27-30 survey. An analyst, however, noted that this rise was hardly significant.

The survey also found 26% of respondents bullish on the economy’s prospects for the year ahead, expecting it would get better, against the 24% who said it would deteriorate, making for a “high” net economic optimism score of +2.

This, however, is still seven points below the also “high” +9% (28% optimistic, 19% pessimistic) seen three months earlier.

It is likewise the lowest net economic optimism score recorded by the SWS under the Aquino administration thus far and since December 2009’s net zero.

The Philippine economy, as measured by gross domestic product (GDP) growth, slowed in the first quarter to a downwardly revised 5.6% from the previous year’s 7.7% and October-December 2013’s 6.3%, cutting short eight consecutive quarters of above-6% GDP expansion.

Last Aug. 28, or after the SWS survey was conducted, however, the government reported that economic growth picked up pace last quarter to 6.4%, albeit still slower than the 7.9% print seen in the same period last year.

That brought first-half growth to 6.0% against a 6.5-7.5% official full-year target.


Asked about how their lives had changed over the last 12 months, 22% of the survey respondents said it had improved (gainers) and 37% said it worsened (losers), for a “mediocre” -14 net gainers score.

This, SWS noted, is a downgrade from the “fair” -6 net gainers score (26% gainers, 32% losers) result seen in the March survey. This is also the lowest net gainers score of the Aquino administration to date, albeit just a tad worse than the previous low of -13 seen in December 2013.

The survey research institution classifies net personal optimism scores of +30 and above as “very high,” while those from +20 to +29 are “high.” The +10 to +19 range, which contains the historical median and mode, is “fair,” +1 to +9 “mediocre,” zero to -9 “low” and -10 and below “very low.”

In the case of net optimism about the economy and gainers/losers -- with scores, historically speaking, having been highly negative -- -30 and below is classified as “very low” and -20 to -29 is “low.” Zero to -9 is “fair,” with the SWS saying a slightly negative score is already better than normal, while -10 to -19 is “mediocre.” Scores of +1 to +9 are “high,” while +10 and above is considered “very high.”

A movement from one classification to another is called by the SWS as either an upgrade or a downgrade.

The report showed that the two-point rise in net personal optimism in the June survey was primarily driven by upgrades in scores in Mindanao and Metro Manila.

Mindanao’s net optimism score climbed seven points to a “very high” +33, up from the “high” +26 recorded in the March round of the survey.

In Metro Manila, net personal optimism likewise rose by one grade to a “very high” +33, up four points from the previous quarter’s “high” +29.

The score in Balance Luzon was steady from last March at a “very high” +32. Net optimism also stayed high in the Visayas at +27, up three points from March’s +24.

By socioeconomic class, net personal optimism saw an upgrade in class D, or the masa, to a “very high” +32 from the “high” +29 at end-March.

In class E, the score stayed at a “high” +28 in the June survey, inching up from +27 in March.

Also, despite a two-point fall to a score of +38 in this round from +40 in March, net personal optimism among the class ABC remained “very high.”

Net optimism about the economy, on the other hand, fell after downgrades were recorded in scores in Metro Manila, Balance Luzon, and Mindanao.

The Metro Manila score plunged 24 points to a “mediocre” -14 in the June survey -- the lowest since February 2009’s -18, the SWS noted -- from the “very high” +10 in March, down three grades.

Net economic optimism also slipped one grade to a “fair” -1 in Balance Luzon due to a nine-point fall from March’s “high” +8.

A similar one-notch downgrade was recorded in the score in Mindanao, which fell seven points to a “high” +7, from a “very high” +14.

These downgrades offset the upgrade seen in the net economic optimism score in the Visayas, which settled at a “very high” +13 in June, up six points from the “high” +7 recorded last March.

By socioeconomic class, downgrades were recorded in class ABC (down 12 points to a “high” +3 from a “very high” +15) and class E (down eight points to a “high” +6 from a “very high” +14). Among the masa or class D, net economic optimism score stayed “high” at +1 despite dropping by seven points from the March level.

Lastly, overall net gainers score in the survey was pulled down by downgrades in Balance Luzon (to a “mediocre” -14 from a “fair” -5) and Visayas (to a “very low” -33 from a “mediocre” -13), as well as a decline in the Metro Manila score (down seven points to -9, but still “fair”). The score in Mindanao also stayed “fair” with a two-point gain to -3.

Net gainers score downgrades were also seen across all socioeconomic classes in June. It fell 10 points and two grades to a “fair” net zero from a “very high” +10 among class ABC. In class D or the masa, it declined eight points to a “mediocre” -13 from a “fair” -5, while in class E, the score fell a grade to a “low” -24 from a “mediocre” -11.

Ramon C. Casiple, executive director of the Institute for Political and Electoral Reform, said the rise in the net personal optimism score “is not significant enough.”

“However, economic developments are taking hold. This has impact on perception,” Mr. Casiple noted in a text message.

Hence, he said, “there is a basis” for an upward improvement in optimism among Filipinos in the near future.

“One, [there is] continued GDP growth. Two, job figures are improving,” said Mr. Casiple.

Moving forward, however, the government can still do more, he said.

“It (the government) should make economic growth felt on the ground through jobs, higher wages, lower prices,” he noted.

Meanwhile, Benjamin E. Diokno, economist at the University of the Philippines and former Budget chief, pointed out the drop in net economic optimism.

“The rise in prices of consumer goods clearly contributed to that. Then, utility rates have also been going up. There’s distrust -- it’s like the government is not doing anything to address these issues,” Mr. Diokno said.

source:  Businessworld

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