Unemployment Rises as Philippine Labour Market Undergoes Major Shifts

The Philippine labour market showed signs of weakening in June, with unemployment rising to 4.9% even as the number of people in work increased.

The latest Labour Force Survey, released by the Philippine Statistics Authority (PSA) on 6 August, estimates that 2.59 million Filipinos were unemployed in June. The unemployment rate was up from 3.7% a year earlier and 4.8% in May, while the number of employed people reached 50.66 million, compared with 50.47 million in June 2025.

The employment rate, however, fell to 95.1% from 96.3% a year earlier, meaning that the increase in the number of people in work did not translate into an improvement in the overall employment rate.

The figures also come as more Filipinos entered the labour force compared with the previous month. Labour force participation rose to 65.1% in June from 63.8% in May, bringing the total labour force to 53.25 million. However, the June rate remained below the 65.7% recorded a year earlier.

Where Work Is Growing and Where It Is Falling

The changes in the labour market are not being felt equally across the economy.

Services accounted for the largest share of people in work in June, at 62.7%, followed by agriculture at 20% and industry at 17.3%. Within these broad sectors, however, some industries recorded notable gains while others saw significant declines.

Accommodation and food services added around 481,000 workers compared with June 2025, while administrative and support services increased by 456,000. Public administration and defence added around 440,000, with education and arts, entertainment and recreation also recording gains.

Other industries moved in the opposite direction. Wholesale and retail trade, including the repair of motor vehicles and motorcycles, recorded the largest decline, with around 903,000 fewer workers than a year earlier. Fishing and aquaculture declined by 467,000, while financial and insurance activities, construction, and human health and social work also recorded decreases.

The labour market is undergoing uneven change, with some industries expanding while others contract. Growth in the overall number of people in work does not necessarily mean growth is being felt across every sector, with some industries expanding while others contract.

Many Workers Are Still Looking for More

The number of Filipinos looking for more work also remains significant.

In June, 6.11 million people were classified as underemployed, representing 12.1% of those in work. That was slightly lower than May's 12.2%, but higher than the 11.4% recorded in June 2025.

Underemployment includes people who want more hours in their current role, another job, or a different job that offers more hours.

Almost half of those classified as underemployed, or 48.1%, are already working 40 hours or more a week.

That suggests the issue is not simply about people wanting to work longer hours. Some may be looking for additional income, a second job or a different opportunity altogether.

For organisations, the figures offer another perspective on the labour market. Having people in work does not necessarily mean their skills, experience and capacity are being fully utilised. For organisations navigating changing talent needs, understanding where that unused capacity exists may be just as important as understanding where new talent is available.

Young Filipinos Face a Weaker Start to Working Life

The figures are particularly notable among younger Filipinos.

Among those aged 15 to 24, the labour force participation rate rose to 33.7% in June, from 33.1% a year earlier. However, the employment rate fell from 90.6% to 86.5%.

Around 6.28 million young people were in work during the month, including approximately 743,000 who were looking for more work.

More young people are entering the labour market, while the proportion in work has declined. For young people at the start of their careers, that can mean fewer opportunities to gain experience and develop the skills needed to progress.

For organisations, the trend also matters. Young workers are an important source of future talent, and weaker labour market conditions at the start of their working lives could make it harder to build a strong talent pipeline over time.

What the Latest Figures Mean for Businesses

The June figures do not show a broad decline across the Philippine labour market. More people are in work, and several areas of the economy continue to add workers.

At the same time, unemployment and underemployment remain higher than a year ago, while some major parts of the economy have recorded sizable falls in the number of workers.

For businesses, the picture is therefore becoming more complicated. A large pool of people in work does not necessarily mean access to the skills or experience organisations need. Where workers are moving, which industries are growing and where people are looking for better opportunities can all influence how organisations approach hiring and workforce planning.

These shifts matter as businesses respond to changes in technology, customer demand and the way work is organised.

The Philippine labour market remains active and sizable, but it is also changing. For organisations, that means paying closer attention to where talent is available, where demand is growing and what people are looking for from their work.

Building the Workforce Behind Growth

A changing labour market requires more than filling vacancies. Organisations need to understand where talent is available, where it is becoming harder to find, and how workforce needs may change.

JMR works with organisations to find the leadership, talent and workforce solutions they need as those requirements evolve — from executive search and permanent talent solutions to flexible and non-permanent talent models.

Talk to JMR Global about your workforce needs.