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Philippines Labor Force and Employment
Population growth averaged 2.9 percent from 1965 to 1980 and
2.5 percent in the late 1980s
(see Population Growth
, ch. 2).
While more than 40 percent of the population was below fifteen
years of age, the growth of the working-age population--those
fifteen years of age and older--was even more rapid than total
population growth. In the 1980s, the working-age population grew
by 2.7 percent annually. In addition, the labor force
participation rate--the proportion of working-age people who were
in the labor force--rose approximately 5 percentage points during
the 1980s, largely because of the increase in the proportion of
women entering the work force. So the actual labor force grew by
750,000 people or approximately 4 percent each year during the
1980s.
Agriculture, which had provided most employment, employed
only approximately 45 percent of the work force in 1990, down
from 60 percent in 1960. Manufacturing industry was not able to
make up the difference. Manufacturing's share of employed people
remained stable at about 12 percent in 1990.
The service sector (commerce, finance, transportation, and a
host of private and public services), perforce, became the
residual employer, accounting for almost 40 percent of the work
force in 1988 as contrasted with 25 percent in 1960. Much of this
growth was in small-scale enterprises or self-employment
activities such as hawking and vending, repair work,
transportation, and personal services. Such endeavors are often
referred to as the "informal sector," because of the lack of
record keeping by its enterprises and a relative freedom from
government regulation, monitoring, or reporting. Informal sector
occupations were characterized by low productivity, modest fixed
assets, long hours of work, and low wages. According to a 1988
study of urban poor in Metro Manila, Cebu, and Davao cities
published in the Philippine Economic Journal, more than
half of the respondents engaged in informal sector work as their
primary income-generating activity.
Unemployment, which had averaged about 4.5 percent during the
1970s, increased drastically following the economic crises of the
early 1980s, peaking in early 1989 at 11.4 percent. Urban areas
fared worse; unemployment in mid-1990, for example, remained
above 15 percent in Metro Manila.
Beyond the unemployment generated from economic mismanagement
and crises was a more long-term, structural employment problem, a
consequence of the highly concentrated control of productive
assets and the inadequate number of work places created by
investment in the industrial economy. The size and growth of the
service sector was one indicator. Underemployment was another.
Underemployment has been predominantly a problem for poor,
less educated, and older people. The unemployed have tended to be
young, inexperienced entrants into the labor force, who were
relatively well educated and not heads of households. In the
first half of the 1980s, approximately 20 percent of male
household heads and 35 percent of female household heads were
unable to find more than forty days of work a quarter.
Overseas migration absorbed a significant amount of
Philippine labor. From the late 1940s through the 1970s, migrants
were largely Filipino members of the United States armed
services, professionals, and relatives of those who had
previously migrated. After liberalization of the United States
Immigration and Nationality Act in October 1965, the number of
United States immigrant visas issued to Filipinos increased
dramatically from approximately 2,500 in 1965 to more than 25,000
in 1970. Most of those emigrating were professionals and their
families. By 1990 Filipino-Americans numbered 1.4 million, making
them the largest Asian community in the United States.
In the 1970s and 1980s, quite a different flow of migration
developed: most emigrants were workers engaged in contract work
in the Middle East and, to a lesser extent, elsewhere. Although
some were professionals, the majority were production,
construction, and transport and equipment workers or operators,
as well as service workers. An increasing number also were
merchant seamen. Inasmuch as wages paid for overseas contract
work have been a multiple of what Filipinos could earn at home,
such employment opportunities have been in great demand.
Government statistics show that overseas placements of land-based
workers increased from 12,500 in 1975 to 385,000 in 1988, a
growth rate of about 30 percent per annum. The number of seamen
also increased, from 23,500 in 1975, to almost 86,000 in 1988.
The average stay abroad was 3.1 years for land-based workers and
6.3 years for seamen.
In 1982 the Philippine Overseas Employment Administration was
established in the Ministry of Labor and Employment. The
Philippine Overseas Employment Administration consolidated
responsibility for regulating overseas land-based workers and
seamen, supervising recruitment, as well as adjudicating
complaints and conflicts. The agency also was tasked with
promoting employment opportunities abroad for Filipinos. Overseas
employment created two benefits for the economy: jobs and foreign
exchange. The total number of placements abroad from 1980 through
1988, 3.2 million, was about one-half the growth in the country's
labor supply during that period. Remittances through the banking
system for the period 1983 to 1988 totaled approximately US$4.6
billion, an amount equal to 14 percent of merchandise exports
during the same period. The Central Bank estimated that
remittances passing through "informal channels" might be as much
as twice the documented figure. If so, export of labor would be
the largest single earner of foreign exchange.
Data as of June 1991
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