Philippines jobless rate jumps to over three-year high of 5.8% in January

The Philippines’ unemployment rate climbed to 5.8% in January 2026, marking its highest level in more than three years, as the labor market cooled after the holidays, the Philippine Statistics Authority (PSA) said on Friday.

Preliminary results from the January 2026 Labor Force Survey (LFS) showed the number of unemployed Filipinos rose to 2.96 million, from 2.17 million in the same month last year, and 2.26 million in December 2025.

PSA Assistant Secretary Divina Gracia L. Del Prado said that the January unemployment rate was the highest recorded since June 2022, when unemployment stood at 6.0%.

The January jobless rate was higher than the 4.3% in January 2025, and the 4.4% in December 2025.

“Usually in our time series, after the Christmas season, our employment rate really goes down… because there are no longer available jobs,” Ms. Del Prado told a livestreamed news briefing.

“Because in December, of course, there are lots of jobs available for our labor force. But month on month, the number of unemployed increased by 695,000. And most of the reasons for this are that people got tired — maybe they were exhausted from working in December, or believing that there are no jobs available,” she added.

The quality of employment also saw a shift, as the underemployment rate — the proportion of those with jobs but seeking more hours — stood at 13.2% in January 2026. This was a tad lower than the 13.3% underemployment rate in January 2025, but higher than the 8% in December 2025.

About 6.35 million Filipinos were considered underemployed persons in January, slightly decreased from the 6.47 million underemployed in January 2025, and 2.42 million seen in December 2025.

The country’s employment rate fell to 94.2% in January 2026, down from 95.7% in January 2025 and 95.6% in December 2025. This was also the lowest employment rate recorded since June 2022 when it stood at 94%.

The number of employed persons in January 2026 fell to 47.94 million, a decline from 48.49 million employed in the same month last year, and 49.43 million in December 2025.

The labor force participation rate (LFPR) eased to 62.3% in January 2026, translating to 50.89 million Filipinos in the labor force. This was lower than the 63.9% (50.65 million) recorded in January 2025, and the 64.4% in December 2025.

Job losses 

On a year-on-year basis, the agriculture and forestry sub-sector lost 1.42 million jobs in January, driven by a drop in the cultivation of paddy rice, corn, and leafy vegetables. Wholesale and retail trade followed with the loss of 729,000 jobs, while fishing and aquaculture shed 140,000 positions.

On the other hand, several sectors posted annual gains in January, led by administrative and support service activities (+403,000), public administration and defense (+342,000), manufacturing (+326,000), and transportation and storage (+160,000).

Month on month, agriculture and forestry jobs plummeted by 1.76 million, while wholesale and retail trade also saw a month-on-month decrease of 888,000 jobs, followed by construction (-199,000), education (-154,000), and accommodation and food service activities (-140,000).

Ms. Del Prado pointed to weather disruptions as a contributing factor, specifically the impact of Typhoon Ada on regions such as Bicol, Eastern Visayas, and Caraga.

Despite the overall job losses, some sub-sectors showed resilience month-on-month. Manufacturing added 546,000 jobs, while other service activities grew by 248,000, and transportation and storage increased by 238,000 from December 2025 to January 2026.

Regarding the quality of remaining jobs, wage and salary workers continued to make up the bulk of the workforce at 68.8%, followed by the self-employed without employees at 24.7%. Within the wage-earner group, private establishments employed 78.5%, while the government accounted for 14.3%.

Among all regions, South Cotabato, Cotabato, Sultan Kudarat, Sarangani, and General Santos City (SOCCSKSARGEN) recorded the highest employment rate at 96.0% in January 2026, while Bicol region posted the lowest at 91.8%.

On the other hand, Bicol region logged the highest unemployment rate in the country at 8.2%.

Eight regions recorded unemployment rates exceeding the 5.8% national average, including Eastern Visayas (7.7%), Zamboanga Peninsula (6.7%), Caraga (6.53%), Negros Island Region (6.50%), provinces of Caveat, Laguna, Batangas, Rizal, and Quezon or CALABARZON at 6.4%, Northern Mindanao at 6.1%, and the National Capital Region at 6.0%.

Support for workers

Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio M. Balisacan said in a statement that the government is intensifying support for the workforce amid “elevated geopolitical tensions and global uncertainties” due to the Iran war.

“Our priority is clear: create more and better jobs at home, strengthen industries, equip our workers with the skills needed for higher-value employment, and ensure that those affected by global disruptions, including OFWs, can transition smoothly into productive opportunities here in the Philippines,” Mr. Balisacan said.

PSA’s Ms. Del Prado warned that the spike in fuel prices could further impact the labor market.

“When the price of oil spikes, businesses, some of them, no longer hire or some of them, lay off. So, it might affect our labor market,” she said.

“Those [migrant workers] who were repatriated [from the Middle East] will also come back home, they will become part of the labor force. Or some of them, not in the labor force, but if they will become part of the labor force and they are unemployed, then they will increase the total number of unemployed and of course the unemployment rate,” she said, adding this will be reflected in the data in the coming months.

Benjamin B. Velasco, an assistant professor at the University of the Philippines Diliman School of Labor and Industrial Relations, said that the big jump in the unemployment rate means that the private sector is not generating enough jobs.

“The unemployment rate for January 2026 should be a wakeup call to the Marcos Jr. administration to shift priorities in its economic and employment agenda,” Mr. Velasco told BusinessWorld in a Facebook messenger chat.

“In the long-term, we need an industrial policy that is state-led and incentivizes labor-intensive and jobs-creating industries and sectors that cater to the domestic market,” he said.

“Things are going to get even worse before they get any better given Trump’s war in Iran which has led to a global economic crisis,” he added. — Erika Mae P. Sinaking, Reporter