go through Adrian H. Halili, reporter
The unemployment rate in the Philippines fell to 3.9% from 4.1% in April, with the number of individual workers reaching an all-time high, the government reported on Tuesday.
According to the latest workforce survey by the Philippine Statistics Agency (PSA), the number of unemployed Filipinos fell from April to 2.06 million in May, and $2.1 million a year ago to 2.11 million a year ago.
The unemployment rate in the year also fell from 4.1% in May 2024.
The country’s unemployment rate averaged 4% in the first five months of 2025, not changing from the same period last year.
National statistician Claire Dennis S. Marca (Claire Dennis S.
“The increase in our labor force participation is considerable – an increase of 1.35 million year-on-year,” he said in a press conference. “Generally, when labor force participation increases, unemployment increases too. But this time it’s different – almost everyone is absorbed and the unemployment rate drops.”
“Our only concern is underemployment (year-on-year).” He added. “Our underemployment rate was only 9.9%, an increase of 1.79 million to 13.1%. People entering the labor market, while they are employed, not all are full-time employees. So, they also contribute to underemployment.”
PSA data shows that 55.32 million Filipinos are part of the workforce in May, from 500.74 million in April, and 50.09 million Filipinos work in May 2024.
It said that this is the highest recorded number since April 2005, when PSA began tracking data.
The proportion of workers in the labor force participation rate (LFPR) or the age of workers (15 years and above) rose to 65.8% in May from 63.7% in April, compared with 64.8% in the same period last year.
Meanwhile, the underemployment rate (those who want longer hours or extra work) dropped 14.6% in April to 13.1% in May, but rose from 9.9% in the same month last year.
This translates to 6.6 million Filipinos, looking for additional work or longer hours, 489,000 less than the 7.09 million in April. Year, this is 4.82 million in May 2024.
Over the five-month period, the underemployment rate averaged 12.9%, up from 12.3% last year.
Arsenio M. Balisacan, secretary of the Ministry of Economics, Planning and Development (DEPDEV), said the increase in labor force participation in May indicates a “healthy and competitive” job market.
“Usually, as more people contribute to the economy, a larger labor force may lead to an increase in economic output and may increase the growth of GDP (Gross Domestic Product),” Mr Balisacan said in a statement.
“This also reflects the impact of growing confidence in the labor market and the ongoing efforts to expand employment opportunities across sectors,” he added.
The Philippines aims to grow GDP in 2025 to 5.5%-6.5%.
Depdev added that the unemployment rate in the Philippines is still lower than that in China (5%) and India (5.6%), but higher than that in Malaysia (3%) and Vietnam (2.2%).
Finance Minister Ralph G. Recto said in a statement that higher labor participation shows that more Filipinos are seeing better job opportunities, which is a sign of economic development.
Mr Balisacan said government-planned infrastructure projects could help attract investment in creating jobs.
He added that efforts to provide Filipinos with skills and abilities needing can help our workforce stay agile in a competitive labor market
“We will use the recently enacted policy reforms to improve high-skill and re-plan plans.”
Employment rate
The PSA also reported that employment rates in May accounted for 96.1% from 95.9% in April 2025 and May 2024.
The number of Filipinos in May increased to 48.67 million from 48.67 million last month.
Among the sectors, services remained the highest employer this month, accounting for 61.8% of the total staff, followed by agriculture (21.1%) and industry sectors (17.1%).
Wholesale and retail trade; motor vehicle and motorcycle repairs are the largest annual workload for the month, adding 489,000 jobs. The second is agriculture and forestry (469,000), administrative and support service activities (371,000), accommodation and food service activities (365,000), and other service activities (175,000).
On the other hand, manufacturing has the largest annual employment age (374,000). Next are construction (298,000); mining and quarrying (82,000); public administration and defense and mandatory So-Cial security (54,000); and water and sewage treatment, waste management and remediation activities (50,000).
Workers, wages and wage workers accounted for 62.8% of the labor force in May, followed by self-employed people (27.9%) (27.9%), unpaid domestic workers (7.5%), and employers in family-run farms or businesses (1.8%).
Working hours in May average 39.8 hours per week, slightly lower than April’s 39.9 hours. The average working hours also dropped from 40.6 hours per week recorded in May 2024.
Inflation dilemma
However, analysts say the increase in labor participation in May may be the result of inflation problems.
“High inflation, uncertainties, and insufficient employment opportunities made people, including those that were initially part of the labor force, go out and contribute to the financial resources of the family. Having just one earner in the family is no longer enough — not even two earners,” Maria Ella Calaor-Oplas, an economics professor who specializes in human capital development research at De La Salle University, said in a Facebook Messenger chat.
She added that the midterm elections may have increased job opportunities.
“The income of LFPR is low because household income is so low and basic goods and services are so expensive that more family members are driven to seek more actively for jobs,” said Jose Enrique “Sonny”, executive director of Ibon Foundation, A. Africa, also in a Viber message. “Unlocking this seemingly favorable growth shows that more Filipinos are trying to make a living from any informal and poor quality jobs they have never found in economies that have failed to create regular and well paid jobs.”
Mr Africa said the government should focus on developing the agricultural and industrial sectors to promote employment.
Jose Sonny G, president of the Federation of Free Workers, Jose Sonny G.
