Christy Tila
Research expert covering the Philippines
Employment in the Philippines - statistics & facts
With its lowest unemployment rate since 1999, the Philippine labor market has shown signs of recovery, especially after the COVID-19 pandemic. The labor force participation rate even surpassed pre-pandemic values, and the underemployment rate has also been its lowest since 2016. Although labor productivity has been fluctuating, the average daily basic pay of wage and salary workers has seen considerable growth in the past decade. Despite such positive trends, concerns about job quality and skill mismatch persist as rapid digitalization threatens job security and income sustainability among the Filipino workforce.
Despite a gradual improvement in the labor market in the Philippines, numerous issues persist that continue to affect the country’s economic growth. Job displacement and skill mismatches could undermine efforts to boost productivity in various sectors.
Characteristics of Filipino workforce
With an employment population of more than 48 million, the employment rate in the Philippines reached its highest figure since 2016, with more than half identified as wage and salary workers. The labor force participation rate has also recovered after its dip in 2020, with men having a significantly higher rate in comparison to women. Specifically, most employed Filipinos were engaged in elementary occupations, or those jobs that require simple or routine tasks, such as in the case of agriculture laborers, mining, manufacturing, or transport. Meanwhile, labor productivity grew by about four percent, reaching roughly 113,000 Philippine pesos in the first quarter of 2025.Service industry generates the highest employment opportunities
The Philippines is largely a services-based economy, with this sector accounting for the highest share of the workforce as of February 2025. The country’s service industry remains a driving force to its economic growth, particularly the wholesale and retail trade and the repair of motor vehicles and motorcycles, which was the leading source industry for employment in 2023. Service-based employment also pays more in comparison to agriculture or industrial sectors. Across regions, wageworkers in the National Capital Region (NCR) had the highest daily real minimum wage, followed by workers in CALABARZON. Women workers in the NCR also received a higher monthly basic pay in comparison to their male counterparts.Factors leading to employment challenges
Although the unemployment rate has declined from a sudden rise in 2021, concerns about skills mismatch within the labor pool remain a significant concern across industries. In fact, in 2023, the social and personal activities industry registered the highest number of job vacancies, as well as in the manufacturing, wholesale and retail trade, and construction industries. Moreover, numerous industries have pushed for the digitalization of their business transactions and processes, resulting in a higher demand for tech-based skills that most displaced workers lack. Although the construction sector has had the highest number of displaced workers in 2023, employees in the Business Processing Outsourcing (BPO) services face the risk of the Artificial Intelligence (AI) in business operations. Employers identified AI and information processing technologies such as big data to drive business transformation in 2030, and employers are considering re-skilling and upskilling existing workforce to better work alongside AI. Although such factors are yet to be seen in the following years, AI has been slowly integrated into multiple businesses for work efficiency.Despite a gradual improvement in the labor market in the Philippines, numerous issues persist that continue to affect the country’s economic growth. Job displacement and skill mismatches could undermine efforts to boost productivity in various sectors.
