Unemployment rises marginally in October

MANILA, Philippines — The number of Filipinos who are unemployed rose marginally in October, likely the result of a confluence of factors that include recent weather disturbances, having more young people opting to return to school, and not having enough applicants qualifying for vacant positions in government.

The results of the October 2018  round of the Labor Force Survey (LFS) of the Philippine Statistics Authority (PSA) showed the unemployment rate rising slightly to 5.1 percent in October from five percent in the October 2017 round. This translates to 2.201 million Filipinos who are unemployed as of October versus 2.185 million in October 2017.

This level of unemployment, though, is still within the target range of 4.7 percent to 5.3 percent for 2018 under the Philippine Development Plan (PDP).

PSA head Lisa Grace Bersales said this could be partly attributed to the recent typhoons that affected employment.

Another reason could be that many young Filipinos are opting to go back to school full time, a factor that is also reflected in the fall in the labor participation rate to 60.6 percent from 62.1 percent last year.

“There may also be more children going back to school, but the effect of that is more seen on labor force participation,” said Bersales.

Among the unemployed, those who are 15 years old to 24 years old made up 44.6 percent of the total versus 43.9 percent last year.

Another reason for the slight increase in unemployment may be that of having fewer applicants who qualify for vacant positions in government, which require civil service eligibility, or openings, in the private sector that have greater qualifications.

“There may be more job openings, but these cannot be filled because of the lack of qualified applicants,” said Bersales. “For example, in government, there are plenty of job openings, but we have difficulty filling these because the government has a lot of qualification standards. One has to be civil service eligible.”

As of October, there are 71.886 million Filipinos aged 15 and above in the labor force work but only 60.6 percent of this as of October are either working or looking for work.

The slight decline in the labor participation rate resulted in a marginal decrease in the employment rate to 94.9 percent as of the October LFS from 95 percent as of October 2017. These translates to 41.329 Filipinos  who are gainfully employed with the sufficient number of paid working hours or those who are self-employed.

Among the major economic sectors in the country, the services sector was the top employer, taking in 56.8 percent of the total employed. The majority (64.4 percent) of those who are employed are wage and salary workers.

Meanwhile, there is still a large number of Filipinos who are underemployed, those who work for less than 40 hours in a week and are looking for more gainful employment. The number of unemployed, however, eased to 13.3 percent of workers (5.502 million)as of the October 2017 LFS  from 15.9 percent (6.616 million) in the October 2017 round.

The National Economic and Development (NEDA) said this indicates an improvement in the quality of work nationwide.

“This signals that the quality of work is improving even outside the National Capital Region (NCR). We attribute this to expanding employment opportunities and the approval of nominal increases in regional wages supported by labor productivity improvements,” said Socioeconomic Planning Secretary Ernesto Pernia.

To further improve the employment situation in the country, NEDA said there is a need to improve social protection programs for workers while providing flexibility for firms to adjust to changing market conditions.

“This should be complemented with the provision of unemployment insurance to support the income of displaced workers who will be negatively affected by economic disruptions,” Pernia said.

The LFS recorded around 826,000 jobs generated in 2018, still behind the government’s annual target of 900,000 to 1.1 million new jobs.

To meet this target, Pernia urged the simplification of issuing business permits and licenses, and even reduction of fees.

In terms of gender, only 46.6 percent of women were recorded  in the labor force for 2018, which is below the 49.7 percent target set for the period. This is because more women are choosing not to work to take care of household duties.

“We need to encourage more women to join the workforce, considering that our country has a high proportion of well-educated women. The recently passed Telecommuting Act will help ensure that both men and women can better share responsibilities at home, while still being productively engaged at work,” said Pernia.