MANILA - The World Bank on Monday said the county needs to invest not just in physical infrastructure but also in human capital to fuel long-term inclusive economic growth.
The World Bank's Philippine Economic Update (PEU) released in Manila on Monday said investments in physical and human capital are essential so that the economy can continue to grow along its current trajectory.
The Philippines is one of the top 3 growth performers in the region in 2017, according to the PEU. However, underemployment remains high with 18-to-20 percent decades-long average with mean wages "largely stagnant," the report said.
The World Bank said higher wages are essential in achieving shared prosperity.
"What the Philippines needs to do is to attract more investments that lead to jobs that produce higher productivity, real wage increase," Birgit Hansl, World Bank's lead economist and program leader for Equitable Growth for Brunei, Malaysia, Philippines and Thailand, said.
"That is what the story is - it's about investing at this point in human capital and in physical infrastructure because these are conditions exactly that will create higher-paying jobs in the future," he added.
The World Bank said the slow progress in policy reforms to create quality employment prevents the Philippines from achieving inclusive growth.
Hansl said the restrictive labor regulations in the country resulted in the prevalence of low-paying, short-term jobs.