By Mariedel Irish U. Catilogo, Researcher
The country’s unemployment rate in March eased on a monthly basis to its lowest since the start of the coronavirus pandemic due to further loosening of mobility restrictions, but job quality worsened to a four-month high.
Preliminary results of the Philippine Statistics Authority’s (PSA) March round of the Labor Force Survey (LFS) on Friday showed the unemployment rate slowed to 5.8% from 6.4% in February. This was also slower than the jobless rate of 7.1% a year ago.
The number of the unemployed Filipinos was reduced by 251,000 to 2.875 million in March from 3.126 million in February. This was also lower by more than half a million from 3.441 million in March last year.
March’s jobless rate was the lowest since the 5.3% in January 2020, before the government imposed strict mobility curbs in March to contain the spread of the coronavirus disease 2019 (COVID-19).
Meanwhile, the size of the labor force in March continued to climb month on month by 1.244 million to 49.850 million. It was larger by 1.078 million from 48.772 million a year ago.
This translated to a labor force participation rate (LFPR) — the proportion of the total labor in the working-age population of 15 years old and over — of 65.4% in March, higher than the previous month’s 63.8% and last year’s 65%.
It was the highest LFPR since the 66.3% in October 2011.
However, the quality of jobs deteriorated in March as more employed Filipinos look for an additional job or longer working hours. The underemployment rate rose to 15.8% that month, an increase from 14% the previous month, but still lower than the 16.2% in the same period last year.
This translated to 7.422 million underemployed Filipinos, an increase of 1.040 million from February’s 6.382 million and higher by 86,000 from 7.335 million a year ago.
Underemployment rate in March was the highest in four months or since the 16.7% recorded in November last year.
The employment rate — the of the employed population to the total workforce — was 94.2% in March, picking up from 93.6% in the previous month and 92.9% in March 2021.
This was equivalent to approximately 46.975 million employed Filipinos, higher by 1.495 million from 45.480 million in February. About 1.643 million Filipinos became employed from last year’s 45.332 million.
“The March labor force survey results reflect the gains from moving around 70% of the economy to Alert Level 1,” Socioeconomic Planning Secretary Karl Kendrick T. Chua said in a press release.
“As we continue to manage the risks, we reiterate our recommendation to shift the entire country to alert level 1 to generate more employment and strengthen the domestic economy against external shocks,” he added.
The National Economic and Development Authority estimated that around 81% of the economy is now under the most lenient Alert Level 1 that prompted businesses to operate at full capacity.
Metro Manila and other areas has been under the Alert Level 1 starting March as COVID-19 cases continued to decline.
Security Bank Corp. Chief Economist Robert Dan J. Roces attributed the improvement in the country’s labor market to the relaxation of quarantine restrictions.
“Latest results jive with higher import numbers, an indication of better capital and consumer demand, and the PMI (purchasing managers’ index) number which was in expansion and indicative of mobility improvements and growth,” Mr. Roces said in an e-mail.
The country’s manufacturing Purchasing Managers’ Index (PMI) an index that indicates the country’s conditions in the manufacturing sector, improved to over three-year high of 53.2 in March. The 50 mark separates expansion from contraction.
In a separate e-mail, Trade Union Congress of the Philippines (TUCP) Spokesperson Alan A. Tanjusay said that “freer alert levels, continuing opening and more mobility of products and services” resulted in the improvement of the unemployment rate.
Meanwhile, the higher underemployment print in March “may be reflective of a labor market still in recovery mode, as businesses gradually reopen,” Mr. Roces said.
The Filipino worker worked on an average of 40.6 hours in a week in March, slightly lower than the 40.8 in February but higher than 39.7 hours last year.
By sector, the services sector remained the largest contributor to the workforce at 57.4%, lower than the 58.2% share in February. This was followed by agriculture at 25.2% from 23.9% and industry at 17.4% from 17.9%.
Mr. Roces was optimistic about the labor market’s recovery this year.
“The labor numbers at this point is a function of the quarantine measures, and if looser curbs hold, then a return to pre-pandemic labor figures is certain,” he added.
For his part, Mr. Tanjusay, spokesperson of the country’s largest labor federation, expressed uncertainty on the recovery of the labor market.
“It depends on the conduct and outcome of the national and local elections. If the democratic process is followed and results are respected then it is possible for existing and new investors come in and create jobs,” he said.
The national elections will be held on May 9.
The PSA started reporting monthly jobs data in 2021. Prior to that, the agency published employment figures on a quarterly (January, April, July, and October) basis.
The March round of LFS was conducted from March 8 to 28.