Unemployment rate in the Philippines picked up to 4.3 percent in January 2025 from a record low of 3.1 percent in December 2024, data from the Philippine Statistics Authority (PSA) show.
The latest figure, however, was lower than 4.5 percent in January 2024.
“In terms of magnitude, the number of unemployed individuals in January 2025 was posted at 2.16 million, the same estimate recorded in January 2024,” the PSA said.
Underemployment rose to 13.3 percent in January from 10.9 percent in December but was lower than 13.7 percent a year ago.
“In terms of magnitude, 6.47 million of the 48.49 million employed individuals expressed the desire to have additional hours of work in their present job or to have additional job, or to have a new job with longer hours of work in January 2025,” the PSA said.
The National Economic and Development Authority (NEDA) said the government would cultivate “a dynamic and investment-friendly economy” while equipping the workforce with industry-standard skills to maintain the upward trajectory of the Philippine labor market.
The PSA also reported that more Filipinos entered the labor market. Labor force participation rose to 63.9 percent in January from 61.1 percent in the same period last year. This equates to an additional 2.6 million individuals across all age groups joining the labor force, of which 1.4 million are in their prime working age.
Youth labor force participation increased to 31.8 percent in January 2025, up from 29.7 percent a year earlier, reflecting stronger engagement among young Filipinos in the labor market.
NEDA Secretary Arsenio Balisacan attributed the labor market’s strong performance to the government’s commitment to creating an enabling business environment while equipping the workforce with industry-relevant skills.
“While we welcome this development, we also acknowledge that these additional jobs are classified as vulnerable. Therefore, our strategy remains clear: to sustain job creation by fostering a dynamic and investment-friendly economy while preparing our workforce for high-growth and emerging industries that offer high-quality, well-paying jobs,” he said.
Sustaining these gains requires the government to encourage workforce development driven by industry through initiatives such as the Enterprise-Based Education and Training administered by the Technical Education and Skills Development Authority and ensure that education and training programs align with labor market needs, NEDA said.
NEDA said the recently-signed Implementing Rules and Regulations for the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy or CREATE MORE Act would create a more favorable investment climate for businesses. The law streamlines fiscal incentive policies, clarifies investment rules, and enhances the ease of doing business, making the Philippines a more attractive investment hub.
“By cutting red tape and clarifying ambiguities in investment policies, CREATE MORE aims to encourage local and foreign enterprises to expand their operations in the Philippines. This thrust, in turn, is expected to create additional employment opportunities and support the broader goal of developing a highly skilled, future-ready workforce,” Balisacan said.
He cited the importance of resilience in the agriculture sector in addressing vulnerable employment. He noted that the government would continue strengthening and modernizing its early warning systems to enhance disaster preparedness by utilizing artificial intelligence (AI) for improved prediction models.
“To further support growth and investment in the IT-BPM sector, the government, working closely with industry players, will promote the reskilling and upskilling of the workforce to meet the industry’s advanced skill requirements amidst AI integration,” said Balisacan.
NEDA is seeking public feedback on the Trabaho Para sa Bayan (TPB) Plan 2025-2034, a comprehensive roadmap designed to create a more inclusive, efficient, and dynamic labor market.