THINK TANK IBON Foundation said the labor market crisis in the country would persist describing it as a “deepening jobs crisis” marked by joblessness, informality and volatility, driven by a “weak and exclusionary economy, not a mere ‘slowdown in momentum’ as the Marcos Jr administration claims.”
In its February 9 report, IBON said ironically the Marcos administration continues to push the weak and exclusionary economic policies in the name of quality job creation, which has been dragging down the country’s labor market.
The December 2025 year-on-year figures already show a troubling jobs situation.
Employment fell by around 758,000, from 50.2 million in December 2024 to 49.4 million in December 2025, while unemployment grew by about 631,000, from 1.6 million to 2.3 million.
The employment rate declined from 96.9% to 95.6%, and the unemployment rate jumped from 3.1% to 4.4 percent. This is alarming because December typically sees a rise in seasonal holiday-related jobs.
Looking beyond a single month, full-year data and trends over the years confirms that the jobs crisis is structural and long-standing as the economy struggles to create decent and sustainable work, it said.
From 2024 to 2025, the number of employed Filipinos increased by just 172,000, from 48.8 million to 49 million, even as the employment rate slipped from 96.2% to 95.8 percent. Unemployment rose by 200,000 from 1.9 million to 2.1 million, pushing the unemployment rate up from 3.8% to 4.2 percent. Underemployment remained high at 5.8 million with a rate of 11.9 percent.
Official figures understate the true extent of joblessness. The reported 2.1 million unemployed excludes some 3.3 million unpaid family workers who are unjustifiably counted as “employed” despite receiving no pay.
IBON estimates that another 1.5 to 2 million discouraged workers – Filipinos who have given up looking for work due to lack of job prospects and who are considered “not in the labor force” rather than unemployed.
Adding official unemployed, unpaid family workers, and estimated discouraged workers dropped from the labor force, the true number of unemployed is likely closer to 7.2 million in December 2025, and 6.9 million for the whole of 2025.
INFORMAL JOBS
Being employed does not mean income security for families, because most jobs available are still informal. IBON estimates that almost 35 million or seven-out-of-ten (71%) of the 49 million total employed in 2025 are informal workers. This includes 13.5 million self-employed, 4.3 million in family farms and businesses, 2.1 million in private households, and around 18 million wage workers in informal establishments.
Employment growth is concentrated in sectors notorious for low paying and insecure work.
Around 34.5 million or over 70% of total employment in 2025 is in agriculture, construction, trade, transport, accommodation and food services, and other low-productivity services. Wages in some of these sectors are among the lowest, with average daily basic pay (ADBP) in 2025 at just P367 in agriculture and P378 in other service activities.
The uncertainty of employment is evident in the increasing volatility of the labor market, which cannot be explained by seasonality alone or by pandemic lockdowns. Over the past six years, year-on-year monthly employment has swung from declines of as much as 1.6 million (July 2025) to increases of up to 2.6 million (January 2025).
By sector, agriculture has been the most unstable, with employment falling by as much as 2 million or rising by up to 1.7 million in a year.
PLATEAUING WAGE
Another worrying sign is the sudden deceleration in the absorption of the growing working-age population into wage and salary jobs, which also dampens economic growth.
Wage and salary employment expanded rapidly after 2003, adding 9.9 million workers and nearly doubling the total to 25.2 million by 2016. Its share of total employment rose from 50% in 2003 to 62% in 2016, but then largely stalled, averaging 63.1% in 2017-2024 and reaching just 63.9% in 2025.
While many of these jobs are mostly low-paid, irregular and not enough to lift households out of poverty, their earlier expansion cumulatively helped boost household consumption and in turn economic growth — benefits which are now fading as job creation slows.
At the root of the jobs crisis is a sluggish and non-inclusive economy, weakened by the lack of strong domestic production sectors as engines for sustained economic growth. Gross domestic product (GDP) growth has steadily slowed from a peak of 7.1% in 2016 to just 4.4% in 2025.
Manufacturing’s share of GDP fell to 17.3%, its lowest in 76 years, while agriculture’s share has dropped to a historic low of 7.9 percent. The 20.5% share of agriculture in total employment and 7.1% of manufacturing in 2025 are the lowest in the country’s history, reflecting long-term agricultural and industrial decline.
Yet the Marcos administration portrays this as a temporary slowdown in the labor market while clinging to the same failed measures – foreign investment dependence, infrastructure-led growth and narrow upskilling programs – that do not strengthen domestic agriculture or Filipino industries.
Agricultural modernization and Filipino industrialization are vital for the economy to be fully unleashed and for the creation of decent and stable jobs. The country needs leadership capable of undertaking bold measures that put the people first, ahead of narrow, self-serving, and profit-driven interests.