Unemployment eases to 3.7%

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.

“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 said.

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.

Source: Business World

Inflation picks up to 2.3% in October

Higher prices of key food items, particularly rice and transport costs, pushed inflation up in October, the Philippine Statistics Authority (PSA) reported on Tuesday.

Source: Business World

Consumer price growth accelerated to 2.3 percent last month from 1.9 percent in September, hitting the median estimate in a Manila Times poll of economists and also falling within the Bangko Sentral ng Pilipinas' (BSP) 2.0- to 2.8-percent forecast.

It was markedly lower than the year-earlier 4.9 percent and remained within the BSP's 2.0- to 4.0-percent target.

"The uptrend in the overall inflation in October 2024 was primarily influenced by the faster annual increment in the heavily-weighted food and non-alcoholic beverages at 2.9 percent during the month from 1.4 percent in September," the PSA said in a statement.

"Also contributing to the uptrend was transport with a slower year-on-year decrease of 2.1 percent during the month from a 2.4 percent annual drop in September 2024," it added.

Core inflation, which excludes volatile food and energy items, remained at 2.4 percent, but was lower than the 5.3 percent a year ago.

Year to date, headline inflation and core inflation averaged 3.3 percent and 3.1 percent, respectively.

Food inflation more than doubled to 3.0 percent last month from September's 1.4 percent and was attributed to rice inflation surging to 9.6 percent from 5.7 percent.

Food and non-alcoholic beverages accounted for the biggest share of overall inflation at 44.3 percent, or 1.5 percentage points, the PSA said.

"In addition, the index of corn also contributed to the uptrend as it recorded a faster annual increase of 9.7 percent during the month from 6.9 percent in September 2024," it noted.

The BSP, meanwhile, said that the latest inflation data was consistent with its assessment that consumer price growth would "continue to trend closer to the low end of the target range over the succeeding quarters."

"This reflects easing supply pressures for key food items, particularly rice," it added.

"Nonetheless, the balance of risks to the outlook for 2025 and 2026 has shifted toward the upside. Upside risks to the inflation outlook could emanate from the potential adjustments in electricity rates and higher minimum wages in areas outside Metro Manila, while downside factors continue to be linked to the impact of lower import tariffs on rice."

The policymaking Monetary Board, it continued, will "maintain a measured approach in its easing cycle to ensure price stability conducive to sustainable economic growth and employment."

Socioeconomic Planning Secretary Arsenio Balisacan said the latest inflation figures were a confirmation that government efforts to keep a lid on price growth were working.

While recent weather disturbances, including Severe Tropical Storm Kristine, have posed significant challenges to food supply and logistics, "the government is working relentlessly to keep food available and prices steady, particularly for essential commodities," he added.

"With targeted support and streamlined food supply chains, we aim to ensure that food is affordable and accessible for Filipino families, especially those most vulnerable to price shocks when disasters hit us."

Albay 2nd District Rep. Joey Salceda, an economist, also said that inflation was likely to end the year within target.

"This will also give the BSP license for further rate cuts, especially since expected OFW (overseas Filipino worker) remittances this December will give them some room on the currency strength side," he added.

While rice inflation "remains a fundamental problem," substantial import tariff cuts ordered in July "seems to have produced positive results, while keeping farmgate prices high for farmers."

Source: Manila Times

Climate change could cut PHL’s GDP by 18% by 2070

The Philippines could potentially lose 18.1% of its gross domestic product (GDP) by 2070 due to climate change under a high emissions scenario, the Asian Development Bank (ADB) said.

“In the Philippines, about half of losses come from sea level rise. And then, a larger share than at the regional average would come from natural resource-based sectors, so agriculture, fisheries, forestry,” David A. Raitzer, senior economist at the ADB’s Economic Research and Development Impact Department, said in a virtual briefing on Thursday.

In particular, the Philippines’ agriculture, forestry and fisheries sectors could suffer a combined 4.7% output loss by 2070 due to the impact of climate change, according to the ADB’s inaugural Asia-Pacific Climate Report.

The estimated loss in the Philippines’ natural resource-based sectors is higher than the 2.1% average loss across the Asia-Pacific, the ADB said.

The developing Asia-Pacific region could potentially suffer a 17% loss in its collective GDP by 2070 if high emissions continue. The losses could climb to as much as 41% of the region’s GDP by 2100.

Among Southeast Asian economies, Vietnam will experience the highest overall GDP loss due to climate change at 30.2% by 2070, followed by Indonesia (26.8%).

“These losses are far above prior model-based losses and are consistent with the upper bound of econometric estimates,” the ADB said in the report. “They also confirm that climate policy responses, including adaptation and mitigation, will be essential to the future welfare of the Asia and Pacific region.”

If climate change continues to worsen, the rising sea levels and storm surges will likely cause trillions of dollars’ worth of annual damage in the Asia-Pacific by 2070, ADB Principal Economist Yi Jiang said at a briefing.

Toru Kubo, senior director at the ADB’s Climate Change and Sustainable Development Department, said inhabited parts of the Asia-Pacific will be 4 to 8 degrees Celsius (°C) warmer within the century.

“Given that warmer air of 1°C can hold roughly 7% more water, that is approximately 30-50% more moisture in the atmosphere that comes crashing down when it hits cold air masses,” Mr. Kubo told the briefing.

“Our cities, the rivers, the drainage systems, the critical infrastructure for power, transport, water, food production systems, buildings and homes are not designed to cope with such extreme heat and sudden volumes of water.”

The Asia-Pacific region generates about half of the world’s greenhouse gas emissions. Many of its countries are signatories to the Paris Agreement, which seeks to limit the average global temperature to within 1.5°C.

“Climate change has supercharged the devastation from tropical storms, heat waves, and floods in the region, contributing to unprecedented economic challenges and human suffering,” ADB President Masatsugu Asakawa said in a statement.

“Urgent, well-coordinated climate action that addresses these impacts is needed before it is too late.”

Despite significant strides in reducing emissions intensity, and a 50% decrease across developing Asia since 2000, the region still produces nearly half of global greenhouse gas emissions.

Rapid production, rising energy demand and increased domestic consumption fueled the emissions rise over the past two decades, the ADB said, with China accounting for two-thirds of the increase. South Asia and Southeast Asia contributed 19.3% and 15.4%, respectively.

The energy sector is the region’s largest emitter, responsible for 77.6% of total emissions, driven by a heavy reliance on fossil fuels.

Left unchecked, these trends place developing Asia at the center of the climate crisis, both in terms of impacts from global warming and solutions, the ADB said.

“The window to stay within the 1.5°C target of the Paris Agreement is rapidly closing,” ADB said.

It urged countries to come up with more ambitious and large-scale mitigation action plans, accelerate the transition to net-zero emissions and scale up investments in advanced climate technologies and nature-based solutions.

Meanwhile, a majority of Filipinos identify climate change as a serious problem, according the ADB’s Climate Change Perception Survey mentioned in the report.

In a survey of 1,000 Filipino respondents, 90% believe climate change affects people now and in the next 10 years, while 86% of respondents said it affects their family now or within the next 10 years.

According to the survey, most Filipinos (71%) said they were most concerned about the impact of flooding, followed by heat waves (54%), unpredictable weather (46%), less productive agriculture/higher food prices/reduced food security (34%), and drought (21%).

More than half (59%) of Filipinos surveyed supported investments in low-emissions and resilient infrastructure, while 45% backed a carbon tax.

The survey was conducted online from July 8 to 31,. It surveyed 13,500 respondents across 14 Asian economies.

asia-pacific-climate-report-2024

.pdf

Download PDF • 8.49MB

Source: Business World and ADB