PH poised for middle-class leap by 2040 with job creation reforms

Structural reforms aimed at boosting job creation could propel the Philippines into middle-class status by 2040 and lift its economic growth to an average of 6.8 percent annually, the World Bank said in a new report released Tuesday.

In the “Country Growth and Jobs Report,” the World Bank emphasized that while the Philippines has recorded significant economic gains in the past 15 years, there remains a need to accelerate reforms to ensure that growth is inclusive and sustainable. The report cited the country’s rapid expansion since 2010, with its gross domestic product doubling and over 11.7 million jobs created, bringing the unemployment rate to a historic low of 3.8 percent in 2024.

Zafer Mustafaoglu, World Bank director for the Philippines, Malaysia, and Brunei, said the country is on the cusp of attaining upper-middle-income status. However, he stressed that the benefits of growth must reach all sectors of society, especially the poor and vulnerable, through job generation and productivity gains.

According to the report, reaching middle-class society status by 2040 will require consistent high growth, supported by regulatory reforms, improved infrastructure, stronger institutions, and enhanced education systems. Investments in climate resilience, technological readiness, and labor market modernization were also identified as crucial factors in maintaining momentum.

World Bank Lead Economist Gonzalo Varela said the full implementation of proposed reforms could not only increase the country’s growth rate but also create over 5.1 million jobs and raise real wages by 12.9 percent over the next 15 years, particularly in the manufacturing and services sectors.

Department of Economy, Planning, and Development Secretary Arsenio Balisacan welcomed the report and affirmed the government’s commitment to structural transformation. In a recorded message, he said the administration is focused on ensuring that public spending is fiscally sustainable and concentrated on strategic areas such as education, healthcare, infrastructure, and food security.

Balisacan added that the government is prioritizing programs with measurable impact to ensure that economic progress translates into improved living standards for all Filipinos.

The report concluded that with bold and sustained reform efforts, the Philippines can achieve its long-term development goals and cement its position as a resilient, competitive, and inclusive economy by 2040.