Unemployment rate falls to 3.7% in September

The Philippines’ unemployment rate fell to 3.7% in September, driven in part by a growing number of female workers joining the labor force ahead of the holiday season, the statistics agency said on Wednesday.

Preliminary data from the Philippine Statistics Authority’s (PSA) Labor Force Survey showed the jobless rate dropped to 3.7% in September from 4% in August and 4.5% in September last year.

This translated to 1.89 million unemployed Filipinos in September, down by 177,000 from August and by 370,000 from a year earlier.

Despite the lower jobless rate, underemployment rose to 11.9% in September from 11.2% in August and 10.7% in September last year.

The number of underemployed Filipinos — those who want longer work hours or an additional job — increased by 831,000 to 5.94 million in September from 5.11 million a year ago.

In the first nine months of the year, the unemployment rate averaged 4%, lower than the 4.6% average a year ago.

PSA data showed the employment rate went up to 96.3% in September from 95.5% a year ago. This is equivalent to 49.87 million employed Filipinos, up by 2.2 million from 47.67 million in September 2023.

In September, the labor force participation rate (LFPR) increased to 65.7% in September, from 64.1% a year ago. This translates to a labor force of 51.77 million in September, up 1.84 million from 49.93 million a year ago.

Undersecretary and National Statistician Claire Dennis S. Mapa said 1.34 million of these new workers were women.

“In [the number of] employed persons year on year, the majority here are actually female workers,” he told a news briefing in mixed English and Filipino.

He noted there has been a steady increase in female workers for the past three months.

The LFPR among female Filipino workers rose to 55.7% in September from 53.4% a year ago. For male workers, the rate also rose to 75.6% from 74.7% a year ago.

“By and large, more and more women and youth are entering the labor force. This bodes well for our economic outlook as more Filipinos see increasing job opportunities. As the holiday season approaches, we expect more employment available in retail trade as well as accommodation and food services,” Finance Secretary Ralph G. Recto said in a statement.

Of the 883,000 new employees seen in September, the bulk or 802,000 were youth, bringing the youth employment rate to 90%.

National Economic and Development Authority (NEDA) Secretary Arsenio M. Balisacan said the government will continue to implement supply-side and demand-side interventions to ensure the government will hit quality employment targets.

“The government is urgently addressing the constraints to high-quality job creation and collaborating with the private sector to capacitate our workers with the right skills and competencies simultaneously,” he added.

Mr. Balisacan said the NEDA is also working to finalize the Trabaho Para sa Bayan Plan, a 10-year roadmap to encourage investments in priority sectors, improve the employability of the current and future workforce, and enhance labor market governance for the next decade.

Declining jobs

By industry, the services sector continued to employ the largest number of Filipinos with 31.31 million workers in September.

This was followed by the agriculture sector, which employed 9.48 million, and the industry sector with 8.56 million workers.

Meanwhile, the administrative and support service activities industry gained the biggest number of new employees year on year with 735,000.

Service activities added 559,000 workers year on year, followed by wholesale and retail trade; repair of motor vehicles and motorcycles with 486,000 and public administration and defense with 333,000.

The manufacturing sector added 200,000 jobs year on year in the third quarter.

On the other hand, accommodation and food service activities had the biggest annual decrease in jobs with 242,000, followed by agriculture and forestry (210,000), fishing and aquaculture (136,000) and construction (87,000).

On average, employed Filipinos worked 40.3 hours a week, slightly lower than the 40.7 hours in August and 40.8 hours in September 2023.

University of the Philippines School of Labor and Industrial Relations Assistant Professor Benjamin B. Velasco said the September unemployment and underemployment data implies that “more people entered the labor force but found part-time or temporary jobs only.”

“This is revealed in the rise in LFPR but lower average hours of work per week along with an increase in people wanting more hours of work,” he said in a Facebook Messenger chat.

“This can mean a greater number of young people employed in freelance work like virtual assistants, internet-based tasks, or delivery riders as shown in the comparative increases in sub-sectors like admin and support services and other service activities,” he added.

University of the Philippines Baguio economics instructor Edgar Antonio C. Suguitan said the underemployment trend reflects the precarious nature of employment in the country.

“It is a sign of a weakness of the economy because the economy does not have the capacity to accommodate a growing labor force,” he told BusinessWorld in a Facebook Messenger chat.

“Rampant in the labor market is this employment ‘flexibility’ as many workers are given temporary contracts,” he added.

Federation of Free Workers (FFW) President Jose Sonny G. Matula sounded the alarm over the rise in underemployment, which he said suggested workers’ incomes are insufficient to meet basic needs, driving them to seek more jobs to survive.

“This financial strain has potential health consequences for workers who are compelled to work longer hours or multiple jobs simply to make ends meet,” he told BusinessWorld in a Viber chat.

He said the decline of employment in the wholesale and retail, construction, human health, and social work activities sectors was concerning.

“While the rise in overall employment indicates resilience in certain areas of the economy, the downturn in these key sectors highlights underlying vulnerabilities,” he said.

PSA data showed wholesale and retail trade lost 597,000 workers month on month. Followed by 284,000 in construction and 177,000 in human health and social work activities.

The labor group leader said wholesale and retail are “traditionally a cornerstone for job creation.” Its decline in workers could potentially impact small businesses and consumer activity, he added. – Chloe Mari A. Hufana, Reporter