Unemployment rate down at 5.4% in July

Unemployment rate in the Philippines dropped to 5.4 percent in July, results of the Philippine Statistics Authority’s Labor Force Survey showed Wednesday.

Of the total 71.56-million population of 15 years old and above, 5.4 percent are jobless compared with 5.6 percent in July 2017.

In a separate statement, the National Economic and Development Authority (NEDA) said the recent unemployment numbers are the lowest unemployment rates recorded for all surveys conducted in July since 2008.

“An average of 1.17 million in additional employment has been created so far in the first three rounds of the Labor Force Survey. And this puts the government on track in meeting its target of 900,000-1.1 million employment generation for 2018,” NEDA chief and Socioeconomic Planning Secretary Ernesto Pernia said.

The employment rate rose to 94.6 percent in July 2018, from 94.4 percent in July 2017.

This is the highest among previous July rounds in the last 10 years and similar to July 2016, with an estimated net generated employment of 488,000, and total employment reaching 40.7 million, according to NEDA.

Higher employment and lower unemployment figures are a welcome development amid the rising inflation, Budget Secretary Benjamin Diokno said during his weekly breakfast forum with reporters on Wednesday.

“People are more tolerant of rising prices when they have jobs, rather than having no jobs,” Diokno said.

Inflation clocked in at 6.4 percent in August, the fastest in over nine years since it came in at 6.6 percent in March 2009. 

“We are confident that employment will really improve. We know that with Build, Build, Build going full blast, we are going to create a lot of jobs,” Diokno said.

The services sector accounted for more than half of the country’s total employment, contributing additional employment of more than 1.1 million.

The industry sector also recorded positive employment growth of 2.2 percent, or 172,000 workers.

Among the industry sub-sectors, manufacturing contributed the most to employment.

“Moreover, the shares of industry and manufacturing to total employment of 19.4 percent and 9.0 percent, respectively, are the highest in a decade,” NEDA said.

“This is consistent with the strong expansion plans of manufacturing firms as a result of a more positive employment outlook for the period,” it said.

Youth unemployment, however, remains high at 14.1 percent.

“The share of inactive youth remains a concern. The government must equip students with industry-relevant competencies as well as increase their opportunities for work experience. A stronger academe-industry linkage should orient students better on career prospects,” Pernia said.

Underemployment, or full-time workers seeking additional hours of work, increased to 17.2 percent or an estimated 7.0 million workers in July 2018. This is higher compared with 16.3 percent or about 6.5 million underemployed workers in July 2017.

“In order to meet our employment targets, government should provide an environment that is conducive to creating more and better jobs. It should prioritize policies and programs that address the issues of unutilized youth, unemployed youth, underemployment, and vulnerable workers,” Pernia said.

He called for reforms that will benefit workers, including access to skills development.

“This package of reforms should include unemployment insurance as an additional safety net and important complement to labor market flexibility,” Pernia said.

“In other words, we need to keep the labor market agile such that more workers and employers can take better advantage of growth opportunities, while still looking after our workers’ welfare,” he said.

The LFS is a nationwide quarterly survey of households to gather data on the demographic and socioeconomic characteristics of the population, and provide statistics on trends of employment, unemployment, and underemployment. —VDS, GMA News