Unemployment rate falls to lowest level since 2005

FILE: Filipino overseas job seekers flock at the Blas F. Ople Building in Mandaluyong City to apply to the available job opportunities in countries, such as Canada, Taiwan, New Zealand, Germany, Japan, Poland, United Kingdom, and others. (Photo: Department of Migrant Workers/Facebook)

MANILA – The country’s unemployment rate in December last year fell to its lowest level since 2005, the Philippine Statistics Authority (PSA) said.

In a briefing on Wednesday, National Statistician Dennis Mapa said preliminary results of the latest Labor Force Survey (LFS) showed that the unemployment rate in December 2023 further went down to 3.1 percent from 4.3 percent in December 2022.

It was also lower than the 3.8 percent seen in November 2023 and the lowest recorded unemployment rate since the PSA introduced a new methodology for measuring the LFS in 2005.

Mapa said the number of unemployed Filipinos was estimated at 1.6 million, lower than the reported 2.22 million in December 2022.

The Labor Force Participation Rate (LFPR), meanwhile, was at 66.6 percent or about 52.13 million Filipinos aged 15 and above who were either employed or unemployed.

The country’s employment rate went up to 96.9 percent in December 2023, higher than the 95.7 percent a year earlier.

The number of employed Filipinos was recorded at 50.52 million in December 2023, higher than the number of employed persons in December 2022 at 49 million.

Mapa said industries with the biggest increase in employment include construction (+777,000), agriculture and forestry (+715,000), accommodation and food service activities (+498,000), transportation and storage (+174,000), and human health and social work activities (+140,000).

Underemployed persons or those who expressed the desire to have additional hours of work in their current job or to have an additional job or to have a new job with longer hours of work was at 6.01 million.

For the full year of 2023, the country’s unemployment went down to 4.3 percent from 5.4 percent in 2022.

Employment rate, on the other hand, increased to 95.7 percent from 2022’s 94.6 percent, while underemployment rate fell to 12.3 percent.

“We welcome the news of a record-low unemployment rate, signifying the economy’s sustained momentum and resiliency of our labor market. Further, the Marcos Administration is steadfast in its commitment to prioritize creating high-paying jobs to address the longstanding vulnerabilities in our country’s employment and lower the underemployment rate, an indicator of job quality,” National Economic and Development Authority Secretary Arsenio Balisacan said in a statement.

“We will continue ramping up social and physical infrastructure investments and dramatically improve human capital to strengthen our people’s employment prospects,” he added.

Given the promising labor market conditions, Balisacan is confident that the favorable trends will continue as the government pushes for more investments by creating an enabling policy and regulatory environment and address constraints in critical areas identified by the private sector.

These include the cost of energy and logistics, the ease of doing business, the competitiveness of the country’s labor force, and the consistency of rules and regulations.

Balisacan vowed that the government will further increase the utilization of digital technology, to raise productivity and promote efficiency.

“The government must ensure that innovation and digitalization become integral across all sectors. To help enable such processes, we are very open to collaborating with our colleagues in Congress to tackle and ultimately pass the Open Access in Data Transmission bill,” he said.

“Accelerating digitalization and improving connectivity through a more competitive and vibrant ICT sector can be a game changer, especially when considering the socioeconomic opportunities that can be created and multiplied for small business owners and those in far-flung areas,” he added.

Balisacan said the government should also enact reforms in education and training programs, such as upskilling and reskilling initiatives, to promote innovation.

He said these efforts will equip the workforce with the necessary skills and adaptability to thrive in the evolving digital landscape.

“We will continue to advocate for interventions to support a more agile and adaptive workforce, such as the Apprenticeship Bill, Lifelong Learning Bill, and Enterprise Productivity Act. These efforts will complement the various initiatives to provide upgraded and expanded employment facilitation services to support our robust labor market,” Balisacan said.

Restored confidence

House ways and means committee chair Joey Salceda said the 3.1 unemployment rate is “as good as full employment”, noting this jobs report affirms the Philippines as the fastest growing economy in the Southeast Asian region for 2023.

Salceda said President Ferdinand R. Marcos Jr.’s policies and signaling have restored confidence in the private sector.

He said the President’s first full year in office created some 1.5 million jobs, primarily driven by the private sector, since public sector spending grew at a modest 0.4 percent last year.

“Business expectations are upbeat and more or less where it was prior to the pandemic. The production index in November 2023, just before the jobs survey would have been conducted, was also the highest it had ever been since the pandemic,” Salceda said.

“All in all, it seems that the private sector – especially industry – views this administration as a government they can work well with – and has reflected it in their appetite to hire new workers,” he added.

Salceda said the industry sector grew by 869,000 jobs year-on-year, which is a “sign that businesses in capital-intensive sectors are digging in and producing more”.

He also cited that the agriculture, forestry, and fisheries sectors grew by a combined 555,000 jobs.

While he finds agriculture jobs growth a net positive, Salceda expressed some concerns about its magnitude.

He said the agriculture and forestry sector created 715,000 new jobs year-on-year, even as total approved investments in the sector were only at PHP3.8 billion in 2022. Fisheries, meanwhile, lost some 159,000 jobs.

“I worry that these new agri-sector jobs might not yet be high-quality jobs backed by strong investments. Total employed persons in the agriculture and forestry sector still total to 11 million – 21.8 percent of all employed persons in a sector that produces just 8.9 percent of the economy,” he added.

Salceda said the agriculture sector must be supported with sustained public and private investment.

“On the public sector side, the Department of Agriculture under Secretary Tiu-Laurel has been working on massive and modern post-harvest facilities and value-chain interventions, which will improve economic output – and therefore wages – in that sector. But, as investment figures show, we really need to open up our agriculture sector to more capital,” he said.