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Philippines: Unemployment rate steadies in June; job quality improves
MANILA, Philippines — Unemployment stood unmoved in June while the quality of available jobs improved, in what may be a show of resilience in the face of rapid inflation.
In a Monday morning briefing, the Philippine Statistics Authority reported that the unemployment rate around the country in June stood at 6%, unchanged since the preceding month. This was equivalent to 2.99 million jobless Filipinos out of the 49.58 million who participated in the monthly labor force survey.
The jobless rate stood at 7.7% back in June last year.
The Philippine economy was fully reopened in the second quarter of 2022 partly as restrictions were lifted as hospitalizations and infections were not worsening then.
However, the number of unemployed in June was much higher compared to the May outturn, since there were more Filipinos who joined the labor force then. National statistician Clare Dennis Mapa reckoned that 570,000 Filipinos joined the labor force in June, 62,000 of them were not hired.
Broken down, five economic sub-sectors shed jobs at a quicker pace in June, with wholesale and retail trade and repair of motor vehicles and motorcycles slashing a combined 1.22 million from its workforce.
Commenting on these figures, Domini Velasquez, chief economist of China Banking Corp. said there was a shift in the business environment.
“The recent job losses in some sectors may point to a shift of businesses that thrive under a high inflation environment,” she said in a Viber message.
The PSA noted tighter budgets compelled this subsector to cut its workforce.
“A shift from non-essential sectors seem evident in June,” Velasquez added.
On the flip side, the quality of jobs in June showed statistical improvements. Underemployment slid down to 12.6% in June from 14.6% in the previous month. In June last year, this figure stood at 14.2%.
This was the second lowest underemployment outturn since the PSA started reporting jobs data monthly. One of the lowest was the 12.3% recorded in May 2021, as restrictions then started easing before another round of lockdowns was imposed as a result of the Delta variant surge.
The National Economic and Development Authority on Tuesday said that while underemployment showed improvements, the Marcos Jr. administration could do more.
“While this is a good indication of the improving quality of work in our country, the government should incessantly boost its efforts towards providing an environment conducive to the creation of more and better employment opportunities,” NEDA Secretary Arsenio M. Balisacan said.
Nicholas Antonio Mapa, senior economist atf ING Bank in Manila, noted that the Bangko Sentral ng Pilipinas’ accommodative monetary policy for most of the pandemic was still impacting the labor market.
“BSP’s monetary easing carried out during the pandemic continues to feed through to the economy with bank lending rising steadily. Bank lending is not linked to credit card purchases alone and has helped support businesses hire more workers and create jobs,” he said in an emailed commentary.
Employment stood at 94% in June, similar to the preceding month’s outturn. ING’s Mapa noted 1.37 million jobs were added in June as labor participation improved.
Velasquez, on the one hand, expects the labor market to contract in the coming months.
“Moving forward, we might see unemployment and underemployment going up in July given higher costs for businesses,” she said.
Second quarter economic growth figures will be presented to the public on Tuesday.
“Aside from elevated oil and construction prices that add to input costs, the effectivity of higher minimum wages across the country in July will impact the appetite of businesses to employ more and may even push them to lay off workers,” Velasquez added.
Source: https://www.philstar.com/business/2022/08/08/2201157/unemployment-rate-steadies-june-job-quality-improves