MANILA, Philippines – Unemployment fell to its second lowest rate in nearly two decades in June 2024, but underemployment remained a problem as the number of underemployed Filipinos increased to more than 6 million.

In the Labor Force Survey of the Philippine Statistics Authority (PSA), the Philippines’ unemployment rate improved to 3.1% in June 2024, equivalent to 1.62 million Filipinos. This is lower than the 4.1% or 2.11 million Filipinos in May 2024, and the 4.5% or 2.33 million Filipinos in June 2023.

The June figure, which technically stands at 3.12%, is the second lowest unemployment rate since April 2005, almost matching the record low 3.07% set in December 2023.

At the same time, underemployment also rose to 12.1%, equivalent to 6.08 million Filipinos in June 2024. This is higher than the 9.9% or 4.82 million Filipinos in May 2024 and 12% or 5.87 million Filipinos in June 2023.

Underemployed individuals refer to those who are employed but want “additional hours of work in their present job or to have [an] additional job, or to have a new job with longer hours of work.”

National Statistician Dennis Mapa said 1.44 million more people joined the labor force in June 2024 compared to the same month last year, but not all of them were absorbed as fully employed.

“Ang nangyayari, dahil lumaki ‘yung na-absorb ng ating labor market, hindi lahat ay nagkaroon ng tinatawag natin na full-time jobs. Some of them are full-time, and then some of them are less than 40 hours o ‘di kaya ninanais pa nila na magkaroon ng trabaho,” Mapa said during the PSA press briefing on Wednesday, August 7.

(What has happened is that our labor market has absorbed more workers, and not everyone has found what we call full-time jobs. Some have full-time positions, while others work less than 40 hours or still wish to have more work.)

The top three subsectors with the highest increase in invisible underemployment — underemployed persons working at least 40 hours in a week — were construction with 195,000 Filipinos there invisibly underemployed; wholesale and retail trade, repair of motor vehicles and motorcycles with 167,000; and manufacturing with 140,000.

A few days before June’s labor data was released, the country’s chief economic planner also highlighted how these employment figures don’t accurately capture job quality. National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan said that even if the employment rate is high, some of the jobs were “not the kind of employment that we really want our population to have.”

“Many of these employed people are in the very informal sector, highly unproductive sectors, like watching your sari-sari store that hardly sells P500 a day. But you’re still employed,” the NEDA secretary told senators in an economic briefing.

However, Mapa remains confident that employment is improving. Many of those who joined the labor force entered the private sector, which the national statistician describes as having better-quality jobs.

Year-on-year, there was an increase in the number of full-time (+3.1 million), wage and salaried (+2.0 million), and middle-skilled (+1.7 million) workers. At the same time, there were fewer workers in part-time (-1.5 million) and vulnerable employment (-521,000) compared to last year.

“Our expectation is that this will continue. Of course, there are threats, but so far, the numbers that we’re seeing — particularly this June wherein we have a low unemployment rate despite the huge increase in our labor force participation rate — is positive,” Mapa said in a mix of English and Filipino.

Construction generates more jobs

Construction was by far the industry that generated the most new jobs year-on-year. It added 939,000 new jobs in June 2024, bringing the total number of Filipinos employed in construction to 5.77 million from 4.83 million in June 2023.

“Economic activity related to construction substantially increased,” Mapa said, adding that nearly 900,000 of those jobs were related to construction of buildings.

The other major industries that had large increases in employment year-on-year were wholesale and retail trade, repair of motor vehicles and motorcycles (+527,000); accommodation and food service activities (+396,000); manufacturing (+353,000); and transportation and storage (+323,000).

Part of the growth in these other industries was also tied with construction, with the retail sales in hardware adding 186,000 new jobs, and the manufacturing of cement adding 161,000 new jobs year-on-year.

“The government’s swift implementation of infrastructure projects and the continued improvement of operating conditions for manufacturing firms have led to these employment gains,” Balisacan said in a statement shortly after employment data was released. “Increasing investments in renewable energy, water supply, and mining and quarrying have also supported employment growth in these areas.”

Meanwhile, agriculture and forestry saw the biggest contraction year-on-year, shedding 916,000 jobs, with more than half or 545,000 jobs related to the planting of rice. Mapa said this was also related to the reduction in the volume of production of crops, particularly rice.

“Makikita natin na substantial ‘yung bawas doon sa growth sa crops natin. Negative siya, in particular, ang ating palay production,” Mapa said. “Masasabi natin malaki ang na-contribute ng El Niño.”

(We can see that there was a substantial drop in the growth of crops. It’s negative, particularly for rice production. We can say that El Niño significantly contributed to this.)

In its statement, NEDA also pinned this on the “impacts of weather disturbances, natural disasters, pest and disease infestation, and the escalating tensions in the West Philippine Sea.” – Rappler.com