The vision of the Philippines, as enshrined in its Constitution, is “a rising standard of living, and an improved quality of life for all.” Yet, this national goal remains elusive. The concentration of wealth and power in the hands of a few has led to one of the slowest poverty reduction rates and middle class growth rates in the region.

To achieve the desired national development, the Philippines needs to grow its economy by at least 10% per year for several consecutive years. This is especially challenging since the country has barely achieved 6% growth in 2023 and is beset with low achievement rates in reading, math and science among its young students.

While our challenges are formidable, we have one important resource at our disposal: our rich cultural and social value system. Pakikipagkapwa-tao, or deep relational concern for others, is a core Filipino value that can be reflected in business practices.

By investing in the growth and development of all employees, business leaders can create a more motivated and productive workforce. This investment includes continuous learning opportunities and career development programs, which are essential for adapting to the rapidly changing job market.  Central to the country’s growth strategy is the inclusive creation of productive jobs and the export of high-value products and services.

To reduce inequality and support inclusive growth, the World Bank suggests policies that support employment, improve education, promote inclusive rural development, strengthen social protection mechanisms, and address inequality of opportunity.

Businesses can contribute by adopting a humanistic management approach, as advocated by the Management Association of the Philippines through its Covenant for Shared Prosperity. The Covenant calls on businesses to take care of employees by recruiting fairly and inclusively, providing just compensation, merit-based promotions, training and development opportunities, and ensuring work-life balance. 

Companies like Boldr and Pandayan Bookshop exemplify just compensation strategies by practicing a living wage system. A living wage is compensation that supports the requirements of decent living for a worker’s family. A minimum wage is a poverty wage because it does not support the worker’s human development needs. 

The Department of Labor and Employment’s Two-Tiered Wage System, comprising a fixed wage plus a productivity wage, can incentivize productivity while ensuring a decent standard of living for workers. Additionally, profit-sharing schemes can align the interests of employees and employers, fostering a sense of shared prosperity and commitment to the company’s success.

All the above, however, will not produce the growth trajectory that our country badly needs. Fortunately, the Fourth Industrial Revolution is upon us and artificial intelligence (AI) has been developing quickly in ways that can help us achieve our national development goals, if we harness it properly. AI has the potential to revolutionize the Philippine economy by enhancing productivity and creating new markets.

However, this must be done with a human-centered approach. We must refuse the temptation to use AI mainly to enhance efficiency. This will lead to tremendous job losses which we can ill afford due to our large population. Instead, effective use of AI can be used to better educate our young and to upskill our workers for optimal productivty. Crucially, we must use AI to support the creation of high-value jobs by improving work processes and fostering market-creating innovations. 

A market-creating innovation addresses poverty by creating new markets that provide products or services to a previously underserved or non-consuming population. These innovations transform what were once luxuries into accessible and affordable necessities, thereby generating economic opportunities and improving the quality of life for those at the bottom of the economic pyramid. 

We have seen how technologies have led to market-creating innovations which have created value-creating work opportunities for so many of our people who were previously marginalized in the economy. Ride-hailing apps, mobile payment systems, delivery services, online markets, online microfinance, online micro insurance, are just a few.  

Importantly, for AI to be truly beneficial for national development, people need to be educated about how AI works, its limitations, and its potential for idea generation and empowerment. AI tools should be designed to enhance material personal sustainability and enable human flourishing. AI tools must be certified for safety and harm prevention, focusing on avoiding issues such as addiction, misinformation, and polarization.

By prioritizing the well-being and autonomy of users, businesses can ensure that AI contributes positively to society. The Responsible AI Council of the Analytics and AI Association of the Philippines is leading the way in promoting professional practices in developing and deploying safe and quality AI in the country.

Achieving humanistic national development in the Philippines requires a multifaceted approach that integrates our positive Filipino cultural values, inclusive business practices, supportive policies and leading edge technologies like AI.

By fostering a culture of people-centered innovation, ensuring just compensation, and investing in the growth of employees, the Philippines can create a more equitable and prosperous society. Human-centered AI, combined with market-creating innovations, holds the promise of transforming the Philippine economy and improving the quality of life for all Filipinos.

Through collective effort and a commitment to humanistic values, the nation can achieve its vision of a rising standard of living and quality of life for all. – Rappler.com

Dr. Benito Teehankee is a Full Professor at the Department of Management and Organization of the Ramon V. del Rosario College of Business. He chairs the Shared Prosperity Committee of the Management Association of the Philippines (MAP) and the Responsible AI Council of the Analytics and AI Association of the Philippines (AAP). benito.teehankee@dlsu.edu.ph