Jobless rate eases to 6.5%, lowest during pandemic

MANILA, Philippines — The number of unemployed Filipinos dropped to its lowest level since the pandemic started, but the labor market has yet to fully improve, with quality jobs still lacking.

The continued downgrade of the COVID alert level in the country resulted in a decline in the number of jobless Filipinos, but this does not necessarily mean that the labor situation is on the mend, according to economists.

Latest data from the Philippine Statistics Authority (PSA) showed that the unemployment rate slid to 6.5 percent in November from 7.4 percent in October. The latest figure is the lowest since the pandemic started in 2020.

This is equivalent to some 3.16 million jobless Filipinos in November, an improvement from the 3.5 million unemployed a month earlier.

Despite the decline in unemployment, the stubbornly high underemployment rate – pertaining to the proportion of workers looking for more hours of work – remains a concern.

The underemployment rate in November inched up to 16.7 percent (equivalent to 7.62 million Filipinos seeking more hours of work) from 16.1 percent (7.04 million)  in October.

Some 580,000 Filipinos are currently employed but are still on the lookout for either additional work or extra work hours to earn adequate income, according to the PSA.

The average weekly hours of work of an employed person also slightly decreased to 39.6 hours from 39.7 hours, it said.

Leonardo Lanzona, labor economist and professor at the Ateneo de Manila University, referred to the current situation as the “working poor” phenomenon.

In a text message to The STAR, Lanzona explained that this is the case wherein employment seems to be high but workers do not earn enough to meet the needs of the family.

“This is often the case when the worker is engaged in services or elementary work, usually in informal arrangements that do not provide decent work conditions, including sufficient work hours,” Lanzona said.

“This phenomenon stems from two factors: the low productivity of workers, and limited government programs to push for high productivity industries and for the effective development of skills,” he said.

The economist said that unless these two concerns are addressed, such a trend would continue, especially as government expenditures are expected to rise further.

National statistician Dennis Mapa, on the other hand, said the increase in underemployment is also because operations of several firms and industries are still not stable due to the impact of the pandemic.

Research and advocacy group IBON Foundation, for its part, said an increase in employment can barely be considered as work and only gives low and erratic incomes with the economy still dominated by too much informality.

IBON executive director Sonny Africa emphasized that the trend is not so much of a labor market improving but of millions of Filipinos struggling to make a living in whatever way possible.

“The bloating of informal work in agriculture and wholesale and retail trade is striking, as is the contraction in transport, hotels and restaurants. The economic managers are erroneous in just passively waiting for these problems to resolve themselves and in so quickly reverting to a business-as-usual attitude,” Africa said.

“This is only a partial view of the problem because it is likely that many are not bothering to look for additional work, which is the definition of underemployment, because of the poor jobs situation,” he said.

Further, Lanzona argued that labor problems are already existing even before the pandemic and the virus just exposed such weakness.

He said the situation is expected to get worse as the virus becomes endemic with the evolution of new variants such as  Omicron.

Africa echoed the same sentiment, saying Omicron will likely dampen and further stall recovery even after the current surge in cases eases toward the end of the month.

“There will always be an underlying uncertainty if the public does not have confidence that the government can efficiently identify and isolate COVID-19 and any new variants as soon as they emerge,” he said.

Meanwhile, the country’s labor force participation rate, or those Filipinos aged 15 years and above, went up to 64.2 percent of the total working age population from 62.6 percent.

This is equivalent to around 48.64 million economically active Filipinos whether employed or looking for work, an increase from  47.33 million in October.

In turn, employment creation improved as 1.65 more Filipinos were able to find work in the past month.

Meanwhile, the biggest driver of the employment gain was fishing and aquaculture at 355,000 due to the harvest season during the review period.

Other industries that showed the largest increase in job creation include other service activities at 323,000, public administration and defense at 292,000, wholesale and retail trade at 282,000, and education at 145,000.

Decreases, on the other hand, were recorded in human health and social work activities, mining and quarrying, water supply, sewerage, waste management and remediation activities, financial and insurance activities, and administrative and support service activities.

Workers are grouped into the three sectors, namely, agriculture, industry, and the services sector. Those in the services sector comprised most of the employed persons, accounting for 58.1 percent share during the month.

Services sector was followed by agriculture with 24.5 percent share while the industry sector accounted for the smallest share of 17.4 percent.