Session 1

Inclusive Innovation Industrial Strategy (I3s) Propelling Jobs, Investments, and Shared Prosperity for All

Assistant Secretary Rafaelita M. Aldaba, Department of Trade and Industry

DR. RAFAELITA ALDABA is the Assistant Secretary for the Industry Development and Trade

Policy Group of the Department of Trade and Industry. She has done extensive research in

various development topics like regional economic integration and international trade,

investment, and competition policy, among others. Asst. Secretary Aldaba is also known for

her contribution in crafting the Industry Roadmap Project of DTI. Previously, she worked at

the Philippine Institute for Development Studies and the Asian Development Bank. She has a

doctorate in economics from the University of the Philippines, and completed Advanced

Studies in International Economics Policy Research.

Session 1

Inclusive Innovation Industrial Strategy (I3s) Propelling Jobs, Investments, and Shared Prosperity for All

Summary

The first session discussed the drivers of growth of the Philippine economy during

global economic uncertainty, the challenges of future production, the need to adopt

an industrial policy for the Philippines, and the general features of the government

Inclusive Innovation Industrial Strategy (i3S).

Key Points PH managed to grow during global economic downturn, mainly driven by growth of

the manufacturing industry. Across geographic areas, several regional economies,

except NCR, are still dependent on agriculture, forestry and fishery.

But PH has low level of readiness for future production under Industry 4.0.

According to the World Economic Forum, the Philippines has low level of readiness

for future production considering the disruptions expected from the Industry 4.0

PH has adopted i3S as its industrial strategy. The Inclusive Innovation Industrial

Strategy (i3S) would build innovation and entrepreneurship ecosystem, remove

obstacles of growth, and strengthen domestic supply chains and global/regional

participation through its five major pillars on (1) new industries cluster, (2) human

capital development, (3) innovation and entrepreneurship, (4) MSME start-up

development, and (5) ease of doing business.

Open Forum

How do government agencies ensure that investment agreements from the foreign trips of the President translate into actual investments for the country?

The government conducts follow-up on countries regarding investment agreements. However, there is need to improve Philippine’s investment promotion as some countries are not familiar with the investment opportunities available in the country.

In what industry/sector would i3S have the most significant impact?

The agriculture sector would benefit the most from i3S. There is a need to

improve the productivity of the agriculture sector by addressing its constraints

through the use of more advance technology. Identifying the problems is easy

but the real challenge is in implementing and executing these plans. There

should be stronger collaboration between the government, academe and

industry.

INCLUSIVE INNOVATION INDUSTRIAL STRATEGY (I3S) PROPELLING JOBS, INVESTMENTS, & SHARED

PROSPERIT Y FOR ALL

R A F A E L I T A M . A L D A B AD T I - B O I

N A T I O N A L P R O D U C T I V I T Y C O N F E R E N C E , M A N I L A1 4 S E P T E M B E R 2 0 1 8

• Macro Performance & Economic Structureo Remarkable performance but poverty has remained

• New Industrial Strategy: inclusive, innovation industrial strategy (i3s) o Five Pillars and Strategic Actionso Top 12 Industry Priorities

• Inclusive FiIipinnovation & Entrepreneurship Roadmapo State of innovation: strengths, weaknesseso vision, where do we want to go, how to get there

• Implications for Labor and Productivity & Training Agencies

Presentation Outline

Inclusive & sustainable innovation-led industrial policy for poverty reduction and

economic transformation

3

Source: World Development Indicators, The World Bank

Macro Performance

• Amid economic & global uncertainty, PH grew 6.4% from 2010 to 2017

• 2017: China 6.9%, Vietnam 6.8%, Philippine 6.7%, Malaysia 5.9%, Indonesia 5.1%, Thailand

3.9%

• PH: 2018 Q2 growth: 6%, 2018 H1 growth: 6.3%

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

GDP Growth in %

CHN IDN MYS PHL THA VNM

High industry growth driven by manufacturing

4

-15

-10

-5

0

5

10

15

20

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Industry Growth in %

CHN IDN MYS PHL THA VNM

7.0 8.611.9

14.4

0.0

5.0

10.0

15.0

20.0

2016 2017

Manufacturing Growth, Selected Asian Countries (%)

China India Indonesia Malaysia Philippines Singapore South Korea Thailand Vietnam

PH EXPERIENCING A MANUFACTURING RESURGENCE

• rising costs in China; growing domestic market, growing middle class, good macro

performance; young English speaking workforce

• 2018 Q2 growth: 5.6%, 2018 H1 growth: 6.6%

Period Manufacturing Services Agriculture, fishing, forestry

2000-2009 3.2 5.2 3.2

2010-2017 7.6 6.7 1.4

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

2010

Q1

2010

Q2

2010

Q3

2010

Q4

2011

Q1

2011

Q2

2011

Q3

2011

Q4

2012

Q1

2012

Q2

2012

Q3

2012

Q4

2013

Q1

2013

Q2

2013

Q3

2013

Q4

2014

Q1

2014

Q2

2014

Q3

2014

Q4

2015

Q1

2015

Q2

2015

Q3

2015

Q4

2016

Q1

2016

Q2

2016

Q3

2016

Q4

2017

Q1

2017

Q2

2017

Q3

2017

Q4

2018

Q1

2018

Q2

Quarterly Growth in %

AGRICULTURE, HUNTING, FISHERY & FORESTRY SECTOR MANUFACTURING SERVICE SECTOR GROSS DOMESTIC PRODUCT

LEADING SECTORS: FOOD MANUFACTURING, ELECTRONICS, CHEMICALS

• Food manufacturing dominated with a share of 33.5% in 2017

• Growth in 2017: 5%, 8.2% in 2016

Food manufactures

Tobacco manufactures

Textile manufactures

Wearing apparel

Footwear and leather and leather products

Wood, bamboo, cane and rattan articles

Paper and paper products

Publishing and printing

Petroleum and other fuel products

Chemical & chemical products

Rubber and plastic products

Non-metallic mineral products

Basic metal industries

Fabricated metal products

Machinery and equipment except

electrical

Office, accounting and computing machinery

Electrical machinery and apparatus

Radio, television and

communication equipment and

apparatus

Transport equipment

Furniture and fixturesMiscellaneous manufactures

-10

-5

0

5

10

15

20

25

30

35

40

45

-15 -10 -5 0 5 10 15 20 25 30 35

Perc

en

tage S

hare

to

Man

ufa

ctu

rin

g V

A,

2010

-2017 A

vera

ge

(%)

Growth Rate, 2010-2017 Average (%)

Regional economies still dependent on agriculture

• Except for NCR, our regional economies are still dependent on agriculture, forestry, and fishery

• In terms of size, the largest contributors are led by Central Luzon (14.8%) followed by

CALABARZON (10.0%), Western Visayas (8.9%), Northern Mindanao (8.6%), & SOCCSKARGEN

(7.4%)

NCR

CAR

ILOCOS

CAGAYAN VALLEY

CENTRAL LUZON

CALABARZON

MIMAROPA

BICOL

WESTERN VISAYAS

CENTRAL VISAYAS

EASTERN VISAYAS

ZAMBOANGA PENINSULA

NORTHERN MINDANAO

DAVAO REGION

SOCCSKSARGEN

CARAGA

ARMM

(10.0)

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

-6.0 -4.0 -2.0 0.0 2.0 4.0 6.0

AH

FF a

s %

of G

RD

P, 2

010-2

017 A

vera

ge

Average Growth Rate (2011-2017)

Manufacturing is confined in Regions 4A, NCR, & 3

• Manufacturing activities have been largely confined in CALABARZON (41.0%),

followed by NCR (18.5%) and Central Luzon (13.5%)

• Central Visayas (6.6%) and Davao (3.3%) trying to catch-up

NCR

CAR

ILOCOS

CAGAYAN VALLEY

CENTRAL LUZON

CALABARZON

MIMAROPA

BICOL

WESTERN VISAYAS

CENTRAL VISAYAS

EASTERN VISAYAS

ZAMBOANGA PENINSULA

NORTHERN MINDANAODAVAO REGION

SOCCSKSARGEN

CARAGAARMM

(10.0)

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0

Man

ufa

cturi

ng

as %

of G

RD

P, 2

010-2

017 A

vera

ge

Average Growth Rate (2011-2017)

Services is concentrated in NCR

• Huge imbalance among the regions in terms of services; services is highly concentrated

in highly urbanized NCR accounting for 51.8% of total

• Outside NCR, services is quite high only in relatively large economic areas led by

CALABARZON (9.9%) followed by Central Luzon (6.6%), & Central Visayas (6.2%)

NCR

CAR

ILOCOSCAGAYAN

VALLEY

CENTRAL LUZON

CALABARZON

MIMAROPA

BICOLWESTERN VISAYAS CENTRAL VISAYAS

EASTERN VISAYAS

ZAMBOANGA PENINSULA

NORTHERN MINDANAO

DAVAO REGION

SOCCSKSARGEN

CARAGA

ARMM

-

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0

Serv

ices

as %

of G

RD

P, 2

010-2

017 A

vera

ge

Average Growth Rate (2011-2017)

New Industrial Strategy

global & domestic context

-4

1

6

11

16

200020012002200320042005200620072008200920102011201220132014201520162017

GDP Growth: 2000-2017

China Indonesia Malaysia Philippines Vietnam

PH: Asia’s Emerging Economic Tiger

Poverty incidence remains high

ARMM 53.7% N. Mindanao 36.6%

CARAGA 39.1% Bicol 36%

E.Visayas 37.3% Zamboanga 33.9%

New Industrial Strategy

GLOBAL & DOMESTIC CONTEXT

Industry 4.0 disrupting business

models at an accelerated pace, is

PH ready?• PH: low level of readiness for

future production, at risk

• Weak institutional framework, human capital, technology & innovation (WEF 2018)

• Upgrade technology platform, reskill/up- skill workers

• Innovation: animating force behind the future of production

New Industrial Strategy

GLOBAL & DOMESTIC CONTEXT

Overall Goal◆ Build innovation & entrepreneurship

ecosystem

-> upgrade & develop new industries

◆ Remove obstacles to growth

-> attract investments, create jobs

◆ Strengthen domestic supply chains &

participation in global/regional value chains

-> link manufacturing with agriculture &

servicesRole of Government: address coordination & market failures;

create proper environment for private sector growth

New

industr

ies

clu

ste

rs

Hum

an r

esourc

e

develo

pm

ent

Ease o

f doin

g

busin

ess

MS

ME

, sta

rt-u

p

develo

pm

ent

Innovation &

entr

epre

neurs

hip

C O N N E C T E D N E S S

New Industries, clusters:

supply/value chain gaps;

domestic & export market;

trade & investment

promotion; incentives

Human Resource

Development

upgrading education

curricula, skills training

programs, improving digital

skills

Innovation &

Entrepreneurship:

government-

academe-industry

linkage, market-

oriented research;

R&D centers,

innovation incentives;

shared facilities &

support for startups,

regional inclusive

innovation hubs

MSMEs: access to

finance, markets, skilled

labor, technology

7Ms: mindset, mastery,

mentoring, money,

machine, market,

models

Ease of Doing

Business:

simplification of

processes, automation;

power, logistics,

infrastructure

GovernmentAcademe

Industry

Strong government-academe-industry collaboration

i3S Five Major Pillars

1

Opportunities

Challenges

◆ New high level

growth trajectory

◆ Growing market,

middle class

◆ Political stability

◆ Young, English

speaking

workforce

◆ Stable business

confidence

◆ AEC & FTAs

◆ Industry 4.0

◆ Complex

regulations

◆ High cost

of power

◆ Lack of ports,

airports, roads

◆ SME access

to finance

◆ Supply chain

gaps

◆ Industry 4.0

Investment activities that are efficiency-seeking & would

cater to both domestic & export markets

100+ Million

Consumer

Market as

springboard

PH as

regional

hub, linked

with GVCs

Strategic Policies

• T r a d e & I n d u s t r y

• I n f r a s t r u c t u r e

• I n v e s t m e n t P r o m o t i o n

• S k i l l s t r a i n i n g , H R D

• I n n o v a t i o n , R & D

• G r e e n g r o w t h

• M S M E & s t a r t u p

d e v e l o p m e n t

Top 12 Priorities for Both Domestic & Export Markets

Electrical & Electronics

Auto & Auto Parts

Aerospace Parts Chemicals

Shipbuilding, RORO

Furniture, Garments, Creative

Tool & Die, Iron & Steel

Agri-businessIT BPM, E-Commerce

Innovation, R&D

Transport, Logistics,

Construction, Tourism

Climate Change,

Parts & Components

SupplyHi-technology, innovation/R&D, infrastructure, regional imbalance, labor-intensity,

sustainability, spill-over/multiplier effects, value/supply chain linkage

1. coffee, cacao, processed fruits, processed meat, tourism

2. processed fruits, processed meat, coffee, furniture, cacao, agribusiness

3. bamboo, furniture, aerospace, processed meat, shipbuilding, aerospace

4A. auto, electronics, petrochemical, IT-BPM, chemicals, aerospace

4B. seaweed, tablea, rubber, coco coir, tourism

5. metal casting, coco coir, health care, agribusiness

6. processed meat, processed shrimp, tourism

7. seaweed/carrageenan, dried mangoes, furniture, IT-BPM, shipbuilding, tourism

8. processed meat, copper, processed marine, processed fruits, natural health, agribusiness

9. rubber, cacao, processed fruits (mango), coconut, agribusiness10. rubber, bamboo, cacao, coco

coir, coffee, agribusiness, tourism

11. processed meat, seaweed/carrageenan, cacao/tablea, agribusiness, tourism

12. rubber, palm oil, processed fish/aquamarine, tourism, agribusiness

13. processed marine, palm oil, rubber, agribusiness

CAR: coffee, processed vegetables, aerospace, electronics, tourism

ARMM: coffee, rubber, cacao, palm oil, agribusiness

Regional Industry Priorities

ASEAN

5. Singapore

35. Malaysia

45. Viet Nam

44. Thailand

57. India

73. Philippines

85. Indonesia

Global Innovation Index 2018

Innovation is at the front & center of our new industrial policy

Competition

INNOVATION

Entrepreneurship

Productivity

Underlying Framework of PH industrial strategyCOMPETITION- INNOVATION-PRODUCTIVITY NEXUS

STRENGTHS:

graduates in science & engineering (#17)

gross capital formation, % of GDP (#32)

market capitalization, % of GDP (#17)

trade, competition & market scale (#30);

firms offering formal training (#9);

research talent (#7);

high & medium high-tech manufactures (#27)

ICT services exports (#8)

WEAKNESSES:

political stability and safety (#117)

ease of starting a business (#121)

expenditure on education, % of GDP

(#109)

pupil-teacher ratio, secondary (#95)

ease of getting credit (#111)

ease of protecting minority investors (#112)

science & technical articles (#120)

Institutions (#93)

Market sophistication (#100)

Global Innovation Index8

7

33

10

0

48

71 76

97

32

83

55

52

818

8

35

74

52 5

9 66

87

37

73

51

47

60

85

35

73

44 45 5

7

INDONESIA MALAYSIA PHILIPPINES THAILAND VIET NAM INDIA

GII RANKINGS

2014 2015 2016 2017 2018

◆ Creative outputs (#92)

◆ ICT access (#86)

◆ ICT use (#83)

◆ Innovation linkages (#93)

GOVERNMENT RESEARCH BUDGET

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2016 2017 2018

0.39%

0.37%

0.44%M

illio

ns

Total Government Budget Total Budget for Research

DA

19%

(DENR)

1%

(DOLE)

0%

(DOST)

76%

DTI)

0%

ARMM)

0%

GOCCs

4%

DEPED

34%

SUCs

45%

DOLE

0%

DOST

1%

Other

Executive

Offices

20%

◆ Block Grants: P10M up to 2 years

◆ Regular GIA: P500-P10M

◆ Frontiers in research excellence: P1M up to 2 years

◆ Industry 4.0 grants: HEI to partner with industry

◆ International Collaborative Grants

◆ Masters or Doctoral Theses

◆ REALM: capacity building

◆ Community-based

participatory action research

(CPAR)

◆ National Technology

Commercialization Program

(NTCP)

◆ National Commodity

Programs: rice, corn, cassava,

HVCs

◆ National thematic programs:

organic agriculture, climate

change, biotechnology

◆ Fabrication Laboratories, Shared

Services Facilities, Negosyo Centers

◆ Intellectual Property Protection

◆ Slingshot, Funding: SBCorp

◆ RIPPLES

◆ R&D incentives & incentives for new

industries, technologies

◆ Industry development & roadmaps

◆ IPR assistance thru TAPI

◆ Technicom: technology innovation for

commercialization

◆ SETUP

◆ TBI Program: diffusion of technology

◆ S4CP: NICER, R&D Leadership

Program

◆ CRADLE, BIST

Limited coordination among research-granting agencies

with MOU

limited

coordination

DOST

Science &

Technology

DA

Agriculture

DTI

Trade &

Industry

CHED

Higher

Education

Weak linkage between industry & academe

• Low GERD due to limited resources

• 42.9% of surveyed firms are innovation active

• Lack of appropriate incentives to produce

competitive & relevant research at universities

• Widespread mistrust between university &

industry communities, more competition than

collaboration

• Lack of strong culture of research in

universities

• Open innovation exist in the supply chain but not with academe

• Lack of STEM-oriented PhD programs, limited post-doctoral research training

• No critical mass in terms of volume of research

• Difficulties in procurement laws

For comments, suggestions or further inquiries please contact:

Philippine Institute for Development Studies Surian sa mga Pag-aaral Pangkaunlaran ng Pilipinas

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constitutes studies that are preliminary and

subject to further revisions. They are being

circulated in a limited number of copies

only for purposes of soliciting comments

and suggestions for further refinements.

The studies under the Series are unedited

and unreviewed.

The views and opinions expressed are

those of the author(s) and do not necessarily

reflect those of the Institute.

Not for quotation without permission

from the author(s) and the Institute.

The Research Information Staf ,

Innovation Activity of Firms

in the Philippines

DISCUSSION PAPER SERIES NO. 2017-44

Francis Mark A. Quimba, Jose Ramon G. Albert,

and Gilberto M. Llanto

December 2017

!!

!

Science, Technology, Research and Innovation for Development (STRIDE) Philippines Innovation Ecosystem Assessment !

!

!

!

!

!

!

!

!November!2014!

◆ Strong collaboration among government, academe, industry connected country

◆ Strong business & policy environment sustainable growth

◆ Creative talent pool: critical mass

poverty

reduction

Source: Startup Commons, From Innovation Ecosystems to Startup Ecosystems, 2017; World Economic Forum 2012

New Funding

Sources

Innovation

EcosystemEntrepreneurship

Ecosystem

Customers

Service

Providers

Big

CompaniesPublic Sector

InnovationFunding

Sources

Support

Orgs

Research

IPR

Regulatory

Framework

& Infrastructure

Culture

Markets

Human

Capital &

Workforce

Availability

Support

Mechanisms

Funding &

Finance

Education &

Training

Bridging the Gaps in Innovation and

Entrepreneurship

PH innovation & entrepreneurship

ecosystem: missing linkages & players,

lack of connectedness

Research,

IPR

Inclusive

Innovation &

Entrepreneurship

Ecosystem

Vision: Inclusive Innovation & Entrepreneurship Ecosystem

• Strong

collaboration:

connected

country

• Strong

business &

policy

environment:

innovation,

jobs,

investment

• Creative

talent pool

• Incubation of

innovation

• Academe industry

partnerships to

conduct basIc,

applied, market

oriented research

• Support by

government &

funders

• Involve

researchers &

experts &

industries across

the country

How do we

create an inclusive

innovation &

entrepreneurship

ecosystem?

hard & soft

infrastructure,

acceleration of

commercialization:

incentives, enabling

environment

entrepreneurial culture,

support for start-ups:

mentors, advisors,

incubators, accelerators,

professional services

How to make SMEs

innovative

relationships,

market driven

research, job-

ready

graduates,

entrepreneur-

specific

trainingsFamily & friends,

private equity, venture

capital, angel

investors, access to

capital

HRD for innovation,

innovation-ready

workforce: technical &

management talent

Position

innovative

industries for

rapid growth

Innovation

Policy &

Commercialization

Skilled

Workforce

Industry

Clusters

Government-

Academe-

Industry

Entrepreneur-

ship, startups

SMEs

Funding &

Finance

1

2

3

4

6

5

To promote collaboration & closer coordination within government

Expand DOST-DTI MOU

DOST

DTI

BOI

IPOPHIL

DICT

DA

DOLE

TESDA

NEDA

DOF

DILG

LGUs

CHED

DEPeD

DOF: Fiscal support for

innovation & R&D, start-up

activities, MSMEs, LEs,

commercialization process

DILG/LGUs: innovation

support

Innovation policy

monitoring/evaluation

of implementation

Market-oriented research

grants

Market-oriented research

grants, commercialization

support

Physical

innovation

infrastructure

Market studies, linking

industries with academe &

other government agencies

Market-oriented research grants,

R&D, commercialization support

HRD & curricular changes

INNOVATION & ENTREPRENEURSHIP ECOSYSTEM

Accelerators/Incubators/

Innovation hubCo-Working

spaces

Support Organizations/

Communities

Events

Meetups

Service

ProvidersUniversities

Large, Small,

Medium

Enterprises,

Start-ups

Government

Funders

Regional Inclusive Innovation Hubs/Centers

• Regional & local inclusive innovation hubs: cornerstone of i3S, lie at the heart of our economic transformation• Bridge gap between industries

& academe• Create regional ecosystem:

virtual & physical made up of universities, R&D labs, S&T parks, incubators, fab labs, co-working spaces, investors, & LGUs, start-ups, SMEs, LEs

• DOST & other agencies, industry, & academe

• Innovation focus on electronics, auto, aerospace, chemicals, IT-BPM, agribusiness

R&D Labs,

S&T Parks

UPGRADING TRA JECTORIES FOR PRIORIT Y INDUSTRIES

Agribusiness

IT-BPM

Aerospace parts

Automotive

Electronics & electrical

R&D, IC design, facilities for advanced products &

technologies, auto electronics, aerospace electronics,

batteries, consumer electronics

Auto electronics, ADAS

components, engineering

services outsourcing, electric

motor powertrains like

battery, EV

Flight control actuation systems,

servo actuators, servo valves,

galley inserts, structures &

equipment, seat parts, lavatories,

interior fit-out, panel assembly,

electronics, airframes & sub-

assemblies; MRO: base & line

maintenance

ESO, data analytics, legal process outsourcing,

health information management (preventive

health, remote), animation & game

development, IT services, global-in-house,

services embedded in manufacturing

mangoes, bananas, nuts, coffee, cacao, coconut, & other

high value crops

UPGRADING TRA JECTORIES FOR PRIORIT Y INDUSTRIES

Chemicals

Parts & Components

Iron & steel

Shipbuilding

Furniture, garments

ConstructionTransport,

Logistics

RORO as well as small- &

medium-sized vessels

Manufacturing &

design

Integrated steel

manufacturing

intermediate parts & components supply

especially those produced by MSMEs

Petrochemicals, oleo chemicals, basic chemicals,

plastics

Mass housing, land, air, &

water transport,

airports & seaports

Industry Upgrading Short to Medium-run

• Close supply/value chain gaps

o Auto: metal casting, forging,

machining

o High value added parts: Auto

electronics, ESO, R&D, sensors,

ADAS

• Accumulation of labor-intensive

industries

• Products with good balance of semi-

automation & labor-intensive work

o Assembly & mid-inspection

require labor-intensive work

FIND THE RIGHT BAL ANCE BETWEEN SKILLS & TECHNOLOGIES

41.3M

Employed

94.6%

7.2M underemployed

17.5%

2.34unemployed

5.4%

43.7

Labor force

61.5%

Skilled workers: 30M, 73% of total

Unskilled: 11M, 27%

22.4

18.956.5

agriculture

fishing forestry

industry

services

323K

Elementary

13.8%

998K

High School

42.6%

161K

Post secondary

6.9%

835K

College

35.7%

Characteristics of the UnemployedStructure of Employment

STEM graduates declined from 235K

(37%) in 2015 to 214K (30%) in 2017

Business Administration & Education &

teacher training graduates increased

from 296K (47%) to 341K (49%)

Labor & Employment Profile

Skilled: Managers 16%, service &

sales 15%, skilled agricultural 13%,

craft & related traders 8%, plant &

machine operators, assemblers 6%

• PH new industrial policy is innovation-focused

o Linking Manufacturing with Agriculture & Services

o inclusive & sustainable growth: industries must be productive

o Innovation is crucial to maintain high productivity level

• Innovation and Entrepreneurship roadmap

o Innovation strategy: creative, connected communities

o Government-academe-industry: basic & applied research providing

solutions to societal issues & industry needs

• Regional inclusive innovation centers

o Bridge gap between innovation & entrepreneurship

o No one size fits all approach: regional/local conditions

o Industry clusters, strong business environment: creation of more & better

jobs, investments, poverty reduction

i3S is vital for sustainable & inclusive developmentinnovation is at the heart of our economic transformation

i3S for sustainable & inclusive development

Propel Jobs, Investments, Shared Prosperity for all • Human capital is crucial for innovation & entrepreneurship

o knowledge production, technology adoption, productivity growth

• Educational system to produce the quality of human capital that can

ignite innovation & entrepreneurship

o Basic, secondary, tertiary: values, skills & competencies to advance

culture of innovation & entrepreneurship

• Government-Industry-Education collaboration to formulate policies

& training programs that are much more responsive to the fast

changing dynamics of industry, avoid mismatch between technology

& skills

• Low-skilled, low-educated & routinized jobs are the most vulnerable

to the adverse effect of technological change

• Provide safety nets through innovation & R&D with education and

training