Underemployment jumps to 13.4%
The Philippine unemployment rate stood at 3.9 percent in March, up slightly from 3.8 percent in February but steady from March last year, the Philippine Statistics Authority (PSA) said.
Underemployment, however, jumped to 13.4 percent in March from 10.1 percent in February and from 11 percent in the year-earlier period, PSA data showed.
The underemployment rate in March 2025 is the highest since April 2024’s 14.6 percent, as shown by the PSA data.
1.93M jobless Filipinos
While the percentages show a steady annual rate for unemployment in March, the actual number of jobless Filipinos eased slightly to 1.93 million from the year-earlier 2.0 million and from the month-earlier 1.94 million
“It is (a) combination of factors: the numbers showed reduction in labor force participation in March 2025 versus March 2024… but there were sectors showing an increase in employment, such as education, administrative and support service activities, and fishing and aquaculture,” PSA Undersecretary and national statistician Claire Dennis Mapa replied to a query from Malaya Business Insight.
The labor force participation rate (LFPR) – the percentage of the working-age population that is either employed or actively seeking employment – declined to 62.9 percent in March 2025, the lowest since January 2024’s 61.1 percent, with 49.96 million Filipinos aged 15 years old and above joining the labor force.
In the same month last year, the LFPR is 65.3 percent, with 51.15 million actively in the labor force. The March 2025 LFPR is also down from the preceding month of February, when the rate stood at 64.5 percent, with 51.09 million Filipinos being part of the labor force.
Employment rate 96.1%
The country’s employment rate year-on-year stayed at 96.1 percent in March 2025, but it was down from February’s 96.2 percent.
Although the percentage remained steady in March in terms of employment, the actual number of employed Filipinos slipped to 48.02 million in March from March 2024’s 49.15 million.
The PSA cited schooling and household responsibilities as the primary reasons for individuals not actively seeking employment.
“In March 2025, we observed a substantial number of individuals choosing to return to school. This means they chose to forego for the meantime opportunities in the labor market to continue their studies. We saw an increase in the number of people citing schooling as their reason for being outside the labor force, an increase of about 816,000, which is quite significant. The second major reason was household family duties,” Mapa said in a press conference in Quezon City on Wednesday.
As for the year-on-year drop in employment, Mapa said two sectors contributed significantly.
“First was agriculture and forestry, which saw a decline of around 609,000 workers. Second, we noticed a large decline in public administration and defense, compulsory social security, with a reduction of 394,000 workers. We feel this was affected by the election ban,” he added, referring to the temporary ban in the hiring of government employees during the election period.
Underemployment shoots up by over 1M
Meanwhile, the number of underemployed Filipinos, or those seeking additional working hours, rose sharply in March 2025, increasing by more than a million individuals, both month-on-month and year-on-year, to hit 6.44 million.
In the same period a year earlier, there were 5.39 million underemployed individuals, while 4.96 million were recorded in February 2025.
Mapa said that the biggest contributor to this increase is the invisible underemployment, or Filipinos who are considered underemployed even if they already work at least 40 hours a week, as they are still seeking additional workhours or jobs with higher pay.
“There is no specific sector that dominated this increase, it is spread out across different sub-sectors,” Mapa said.
Sectors that contributed to the increase in underemployment, Mapa said, are building constructions; wholesale and retail trade, repair of motor vehicles and motorcycles; public administration and defense, compulsory social security; other service activities; and administrative and support service activities.
Job generation plan
In a statement, the Department of Economy, Planning, and Development (DEPDev) said that the government’s recently launched 10-year Trabaho Para sa Bayan (TPB) Plan comes at a critical time, following the reported spike in underemployment.
“The latest employment figures highlight the need for a comprehensive set of interventions to increase investments, encourage technology adoption, improve job satisfaction and employment quality. The TPB Plan will serve as our strategic roadmap toward building resilient employment, fostering competitive enterprises, and preparing a future-ready workforce,” DEPDev Undersecretary for Policy and Planning, Rosemarie Edillon said in the statement.
The TPB Plan is the country’s first 10-year Labor Market Development Plan, which provides a long-term strategic framework for job creation, labor market transformation and inclusive workforce development.
“In response to the rapidly growing demand for specialized skills, the government, through the TPB Plan, is expanding access to upskilling and reskilling opportunities for Filipino workers. These initiatives are crucial to addressing skills shortages and aligning the Philippine labor market with global workforce standards,” Edillon said.
To encourage greater labor force participation, Edillon emphasized the need to promote inclusive and flexible work arrangements.
This may involve revisiting existing policy frameworks to support alternative work arrangements such as part-time and output-based employment.
She also highlighted the Expanded Tertiary Education Equivalency and Accreditation Program Act, which enables professionals to earn a college degree through a comprehensive, competency-based assessment. This initiative supports lifelong learning and provides new pathways for career advancement.
