July unemployment rate seen worsening to 22.9%
The unemployment rate in July likely exceeded a fifth of the labor force as more firms shed jobs during the prolonged COVID-19 lockdown, Dutch banking giant ING said.
It projected the Philippines’ jobless rate hitting a new high of 22.9 percent last month, up from 17.7 percent in April.
The Philippine Statistics Authority (PSA) will release the results of the July round of its Labor Force Survey on Sept. 4, Friday.
“Job losses undoubtedly piled on in the months after [April] given that the economy is now in recession,” Nicholas Antonio T. Mapa, ING’s senior economist for the Philippines, told the Inquirer last week.
“The more than 20-percent unemployment should reflect the 16.5-percent decline in gross domestic product in the second quarter and [which is] not likely to get up anytime soon,” Mapa said.
Following the longest and most stringent COVID-19 lockdown in the region imposed from mid-March to May, the government gradually eased quarantine restrictions starting June to facilitate economic recovery even as some jobs did not resume.
Mapa noted that “most of the layoffs may have happened after April” as businesses were most badly hit at the height of the lockdown.
“We also saw an influx of graduates into the workforce so we could see an increase in the scores of the unemployed,” Mapa added.
There were an estimated 4.9 million Filipinos who lost their jobs in April, according to PSA.
It said that month saw joblessness climb to its highest rate—17.7 percent—after the engines of the economy had to stop amid one of the strictest COVID-19 lockdowns in Southeast Asia, putting at risk recent big gains in reducing poverty incidence.
Preliminary results of the PSA’s labor force survey showed that 7.3 million were unemployed as of April, jumping from 2.3 million a year ago and 2.4 million in January.
The unemployment rate was only 5.1 percent in April 2019 and 5.3 percent in January this year.
Last April’s unemployment rate was the highest since April 2005, when the government changed its methodology in measuring employment. Using a different methodology, government records showed the last time that the jobless rate was double-digit was nearly 30 years ago—during the second quarter of 1991.
The decline in employment rate to 82.3 percent last April from 94.9 percent a year ago and 94.7 percent in January translated to a drop of 8 million in the number of Filipinos with jobs to 33.8 million from 41.8 million last year. In January, 42.7 million Filipinos were employed. INQ
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