Philippines sees highest labor participation since 2005

The Philippines recorded its highest labor force participation rate since April 2005, with the Marcos administration reaffirming its commitment to creating high-quality, high-paying jobs for Filipinos, the Department of Economy, Planning, and Development (DEPDev) said.

The Philippine Statistics Authority's (PSA) Labor Force Survey showed that 65.8% of individuals aged 15 and over were in the labor force in May 2025, up from 64.8% in the same period last year. This indicates an additional 1.4 million Filipinos joined the workforce, which now totals 52.32 million.

The unemployment rate declined to 3.9% in May 2025 from 4.1% in May 2024. This figure is lower than China's (5.0%) and India's (5.6%) but higher than Malaysia's (3.0%) and Vietnam's (2.2%).

However, the underemployment rate rose to 13.1% in May 2025 from 9.9% in May 2024. More part-time workers seeking additional hours cited variable schedules or the nature of their work as reasons for working less than 40 hours per week. Holidays were also a factor for some.

"We welcome this development in labor force participation because it indicates a healthy and competitive Philippine labor market," said Economy, Planning, and Development Secretary Arsenio M. Balisacan. "Generally, a larger workforce can lead to increased economic output and potentially higher GDP growth, as more people contribute to the economy."

Balisacan added that this reflects growing confidence in the labor market and the impact of ongoing efforts to expand employment opportunities.

The government's push for critical Infrastructure Flagship Projects aims to attract job-generating investments, he said. Balisacan also stressed the need to enhance public spending efficiency, allocating resources to high-impact areas such as quality education, healthcare, food security, and connectivity infrastructure.

Equipping Filipinos with in-demand skills will ensure the workforce remains agile in a competitive market, Balisacan said. He highlighted leveraging recent policy reforms to improve upskilling and reskilling initiatives, including stronger industry partnerships under the Enterprise-Based Education and Training (EBET) Framework Act, the Expanded Tertiary Education Equivalency and Accreditation Program (ETEEAP), and the proposed Lifelong Learning Development Framework Bill. These are detailed in the recently launched "Trabaho para sa Bayan Plan."

The government is also working to attract more Global Capability Centers (GCCs) as the country shifts towards high-value IT-BPM services. This will involve strengthening workforce competencies in digitalization and generative AI.

Timely guidelines on the "Future Workforce in an AI Workplace" are set to be released to help integrate AI into operations while safeguarding jobs through enhanced digital literacy and AI-related skills.

The Philippine Development Plan 2023-2028 midterm update, highlighting key priorities and recalibrated strategies for achieving the government’s transformation agenda, including quality job creation, is scheduled for release this month.