Labor Day — RP unemployment remains high

TO mark Labor Day, we post the most recent results of government’s labor force survey, first released to the public in March. These figures were obtained from the National Statistics Office’s (NSO) January 2006 survey.

While the country’s unemployment rate is officially reported to have gone down, analysts say it remains significantly high, with not enough jobs being created to absorb the labor force.

The labor force survey showed the following:

• Total population, 15 years old and over – 55,248,000
• Labor force – 35,224,000
• Labor force participation rate – 63.8%
• Employment – 32,384,000
• Employment rate – 91.9%
• Unemployment – 2,840,000
• Unemployment rate – 8.1%
• Underemployment – 6,895,000
• Underemployment rate – 21.3%

According to the survey, the agriculture, fishery and forestry sector posted the highest increase in employment, growing by 4.2 percent from 11.4 million in January 2005 to 11.8 million in January 2006.

Employment also grew, said the NSO, in the services sector.

But employment in the industry dropped by 95,000, as the number of employed in the sector went down from 4.977 million in January 2005 to 4.882 million this year.

This round of survey used government’s new definition of unemployment. Independent economists have criticized such redefinition (click here and here), saying it artificially pulls down the rate of unemployment, as it includes only those who are actively seeking for work. The old definition of “unemployed” includes those who do not have work and are not looking for work because of their belief that no work was available, or because of temporary illness/disability, bad weather, pending a job application or waiting for a job interview.

The NSO, in its January 2006 Survey, itself noted that if the old definition was used, the unemployment rate will be pegged at 10.7 percent.

Historically, the country’s unemployment rate hovered around 10-11 percent in the recent several years.

The Asian Development Bank (ADB) had noted in its latest annual Development Outlook, that the country’s unemployment rate “remains stubbornly high.”

The ADB also reported that the country’s unemployment burden was being eased mostly by the migration of workers overseas. The ADB noted that in 2005, close to a million Filipinos were deployed for work abroad. The Bank added, “Although generating subsequent remittance income, emigration on this scale comes at a high cost in terms of loss of knowledge and skills, and can have high social costs as well.” (Access ADB’s report here.)

NSO also said underemployment rose to 6.9 million in January 2006, from 5.1 million a year ago, bringing the rate of those who desire additional work to 21.3 percent.

Among those who are underemployed, the biggest proportion was in the agriculture sector (47.2%), followed by those in the services sector (37.8%).

Overall, in terms of occupation, laborers and unskilled workers posted the biggest increase both in levels and percentage share.

The Arroyo administration promises to create “6 to 10 million” jobs during its term, saying unemployment has to be reduced significantly for the country to combat poverty.

Click here for more labor statistics.