Businesses are seen slowing down on hiring and expansion in the first quarter of next year as demand historically softens after the Christmas season.
Results of the Bangko Sentral ng Pilipinas’ (BSP) business expectations survey (BES) for the fourth quarter of 2017 showed that the employment outlook index dropped to 24.7 percent for the next quarter from 27.3 percent in the previous quarter’s poll.
“This indicates that firms will continue to hire new employees than those that indicated otherwise even as the number of firms with hiring intentions declined relative to a quarter ago,” the BSP explained.
Also, “the percentage of businesses with expansion plans in the industry sector for the first quarter of 2018 decreased to 31.1 percent from 32.8 percent in the previous quarter,” the BSP added.
According to the BSP, “the outlook was weaker across industry subsectors.”
Last Tuesday, the BSP reported that the fourth-quarter BES results showed that the business outlook for the quarter ahead, or from January to March, was less optimistic, as the next quarter confidence index slid to 39.7 percent from 51.3 percent during the third-quarter survey.
“Respondents attributed their less positive outlook [for the first quarter of 2018] mainly to the usual slowdown of demand after the holiday season,” the BSP said.
“Other reasons cited by firms were lag in business transactions at the beginning of the year (such as delay in renewal of contracts and dry dock season for the shipping industry), stiffer business competition, concerns on the effect of the new excise tax rates to the automobile industry, and higher inflation,” according to the BSP.