Finance Secretary Ralph G. Recto has underscored that the country’s increasingly robust labor market, better job quality, and its historic gross national income (GNI) per capita solidify the Philippines’ positive trajectory towards reaching an upper middle-income status by 2025 and single-digit poverty rate by 2028.
“We are seeing encouraging signs that our economic goals are on track and within reach on the back of the continued improvements in the labor market and after we reached a record-high GNI per capita last year,” Secretary Recto said.
The Labor Force Survey (LFS) in May 2024 showed that the country’s job market remained robust with the unemployment rate dropping to 4.1% from 4.3% in the same period last year. This translates to 61,000 fewer unemployed individuals.
Filipinos engaged in more quality jobs are also growing as underemployment fell to 9.9% in May, the lowest since April 2005.
This improvement in the quality of employment is evident in the current landscape of the labor class in the country, with wage and salary workers continuing to contribute the largest share of the total employed individuals at 63.0% (30.8 million) in May.
Private sector establishments provided the majority of the boost with an additional 1.6 million increase in wage and salary workers for the month compared to May 2023.
Among the wage and salary workers, private establishments employed 77.3% (23.8 million), while the public sector composed 15.3% (4.7 million).
The services sector continued to provide the most jobs for the month, accounting for 60.1% (29.4 million) of the employed population. This was followed by agriculture (20.8% or 10.2 million) and industry (19.1% or 9.3 million) sectors.
Notably, the construction and manufacturing subsectors grew significantly in May, adding 745,000 and 347,000 jobs, respectively, on the back of the Marcos, Jr. administration’s aggressive roll-out of the Build, Better, More program.
PH achievement of all-time high GNI per capita
Along with the strong employment figures, the Finance Chief underscored that the Philippines’ historic high GNI per capita of USD 4,230 in 2023 signifies profound improvements in the standard of living of Filipinos as more and better economic opportunities are available for them.
“Achieving this all-time high GNI per capita reflects the Philippines’ robust economic growth and strong macroeconomic fundamentals,” he said.
GNI per capita measures the economic output per citizen, including both domestic and international earnings. A higher GNI per capita means greater economic prosperity and an increased standard of living.
“Our main focus now is sustaining this momentum for the Philippines to graduate into an upper middle-income status by next year and reduce the poverty rate to only 9 percent by the end of the President’s term,” Secretary Recto stressed.
“We are working doubly hard to ensure that all Filipinos reap the rewards of strong economic growth through more comfortable lives and more high-quality jobs,” he added.
The World Bank defines upper-middle-income countries as those with GNI per capita ranging between USD 4,516 and USD 14,005 for the fiscal year 2025.
New government interventions to improve the labor market
On July 3, 2024, the government launched the National Artificial Intelligence (AI) Strategy Roadmap 2.0 to accelerate AI development, expand upskilling programs, and boost the adoption of AI-enabled processes and solutions in the business sector.
The government, led by the National Economic and Development Authority (NEDA), is set to complete the Trabaho Para sa Bayan (TPB) Act, which will serve as the country’s master plan to increase the number and quality of jobs for Filipinos and enhance workforce employability.
Several reforms on promoting human capital development are also underway, such as the Academic Recovery and Accessible Learning (ARAL) Program, which seeks to establish a national learning intervention program that will help students catch up with the required standard of their respective grade levels while accelerating the recovery of the learning losses incurred during the pandemic.
Additionally, the proposed FY 2025 National Expenditure Program (NEP) includes initiatives to increase income-earning abilities. These are the Supporting Innovation in the Philippine Technical and Vocational Education and Training System (SIPTVETS) and the Special Training for Employment Program (STEP).
