Agricultural Labor Absorption by Industrial Firms in the Clark Freeport Zone

Abstract

The Lewis two-sector model assumes that surplus labor from the agricultural sector is being absorbed by the industrial sector. This study, however, found that such an assumption does not hold in practice. None of the 186 respondents from the 13 sample 􀏔irms were from the agricultural, 􀏔isheries, and agribusiness sectors. Nevertheless, employment in industrial 􀏔irms inside the Clark Freeport Zone has had a positive impact on wages and working and living conditions of the respondents. Speci􀏔ically, the P361.5 mean current daily wage rate of the respondents was found to be signi􀏔icantly higher than the P290.5 mean daily wage rate that they used to get prior to their employment in industrial 􀏔irms inside the Clark Freeport Zone