Alvaro Laureano

SYSDYN2 : System Dynamics on Philippine Unemployment

Problem
The unemployment rate in the Philippines stood at 3.4 percent in the September quarter 2019,
the same pace as in the corresponding period the prior year. The number of unemployed
persons edged down by 1% to 2.43 million, while the number of employed grew by 3 percent to
42.2 million. Meanwhile, the labor force participation rate increased to 65 percent from 60.1
percent a year ago. Among employed persons, workers in the services sector made up 57.8
percent of the total, followed by those in the agriculture sector (23.5 percent) and industry (18.7
percent).

Variable: Unemployed Filipinos

Unemployed Filipinos (Thousands)

4,000.00

3,500.00

3,000.00

2,500.00

2,000.00

1,500.00

1,000.00

500.00

0.00
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Meanwhile, the labor force participation rate increased to 62.1 percent from 60.1 percent a year
ago. Among employed persons, workers in the services sector made up 57.8 percent of the
total, followed by those in the agriculture sector (23.5 percent) and industry (18.7 percent).
Unemployment Rate in Philippines averaged 8.28 percent from 1994 until 2019, reaching an all
time high of 13.90 percent in the first quarter of 2000 and a record low of 4.70 percent in the
fourth quarter of 2016.
 4,000.00 3755 Unemployed Filipinos ('000)
3,500.00
2925 2773
3,000.00 2561
2432 2443 2320 2323 2410
2,500.00 2040 2185 2070
2,000.00
1,500.00
1,000.00
500.00
0.00
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Unemployment Rate in Philippines averaged 8.28 percent from 1994 until 2019,
reaching an all time high of 13.90 percent in the first quarter of 2000 and a record low of
4.70 percent in the fourth quarter of 2016. The unemployment rate was steady at 5.4
percent, which remained to be the lowest recorded for all July rounds of the survey
since 2009.
The total number of employed Filipinos reached nearly 43 million in July 2019 on
account of stronger employment in the services (6.1% from 4.7% in 2018) and
agriculture sectors (7.6% from -7.4% in 2018).
Underemployment rate – the proportion of those already employed but still wanting
more work – fell to its lowest in all July rounds of the survey at 13.9 percent, from year-
ago’s 17.2 percent. This translates to a reduction of over a million underemployed
workers in July 2019.

Figure 1: Unemployment rate Update

Of the estimated 71.9 million population 15 years old and over in October 2018, approximately
43.5 million persons were in the labor force, that is, either employed or unemployed (Table 1
and Table 3). This translates to a labor force participation rate (LFPR) of 60.6 percent. Region X
(Northern Mindanao) had the highest reported LFPR with 65.2 percent while the lowest LFPR
reported was in Autonomous Region in Muslim Mindanao (ARMM) at 49.5 percent

Total
Population 15 Total Labor Not in the
Sex and Age Group Employed Unemployed
Years Old Force Labor Force
and Over

Philippines
Both Sexes 72,525 43,660 41,376 2,284 28,865
Number (in thousands)
Total 100.0 100.0 100.0 100.0 100.0
15 - 24 27.3 16.2 14.7 43.7 44.2
25 - 34 22.6 27.7 27.5 30.6 15.1
35 - 44 17.7 22.8 23.3 13.1 9.9
45 - 54 14.2 18.1 18.7 7.8 8.4
55 - 64 10.2 10.8 11.2 4.0 9.2
65 and over 7.9 4.4 4.6 0.8 13.2
Not reported 0.0 0.0 - 0.0 0.0
In contrast, the unemployment rate in the Philippines is set to increase over the course of this
year. Much of this increase is expected to occur in countries where fuel exports are a big share
of export earnings. The increase is driven by recessions in lar in the ASEAN market. Elsewhere,
many economies are growing modestly, thus limiting the labor market deterioration 

Total
Population
Total Labor Unemploye Not in the
Sex and Age Group 15 Years Employed
Force d Labor Force
Old and
Over

Philippines (‘000) (‘000)

Both Sexes 72,525 43,660 41,376 2,284 28,865
Number (in thousands)
Total 100.0 100.0 100.0 100.0 100.0
15 - 24 27.3 16.2 14.7 43.7 44.2
25 - 34 22.6 27.7 27.5 30.6 15.1
35 - 44 17.7 22.8 23.3 13.1 9.9
45 - 54 14.2 18.1 18.7 7.8 8.4
55 - 64 10.2 10.8 11.2 4.0 9.2
65 and over 7.9 4.4 4.6 0.8 13.2
Not reported 0.0 0.0 - 0.0 0.0

Merchandise export growth picked up in July on stronger foreign sales of agricultural and
manufacturing goods, and despite a continued slowdown in electronics shipments. Meanwhile,
the manufacturing PMI hit a six-month high in July, although it retreated marginally in August,
signaling the manufacturing sector continues to weather tougher operating conditions better
than most regional peers on sustained domestic demand. Meanwhile, fiscal spending
rebounded in July due to renewed public consumption following the finally-instated 2019 budget.
Job is something essential that is sought by every human being and is the livelihood of every
human being in the world. work is one of the reasons for humans to survive. Work to survive. By
working every human being is able to meet the necessary needs and as one of the helpers of
the human lifestyle. However, in the world not all people easily have such a good job as if they
were wearing a shirt with a necktie accessory or using a blesser every day in high hills, riding a
luxury car and working in a large company. 

Laws Rated to Employment

AN ACT TO PROVIDE FOR THE ORGANIZATION OF A NATIONAL EMPLOYMENT
SERVICE
REPUBLIC ACT No. 761  
National Employment Service; Creation of. - In order to ensure the best possible
organization of the employment market as an integral part of the national program for
the achievement and maintenance of maximum employment and the development and
use of productive resources, there is hereby established a national system of free public
employment offices to be known as the National Employment Service, hereinafter
referred to as the Service. 
REPUBLIC ACT NO. 5462 - AN ACT ESTABLISHING A NATIONAL POLICY ON
MANPOWER AND OUT-OF-SCHOOL YOUTH PLANNING AND DEVELOPMENT,
CREATING A NATIONAL MANPOWER AND YOUTH COUNCIL AND OTHER
INSTITUTIONS, AND FOR OTHER PURPOSES

known as the Manpower and Out-of-School Youth Development Act of the Philippines.  
This Act is a social legislation intended to take care of, train and develop human
resources and to establish institutions and formulate integrated plans, programs and
projects as will insure efficient and proper allocation, accelerated development and
optimum utilization of the nation's manpower and out-of-school youth and thereby
develop civic efficiency and strengthen family life.
To carry out the purposes and objectives of this Act, there is hereby created in the
Office of the President a National Manpower and Youth Council, hereinafter referred to
as the Council composed of the Secretary of Labor as ex-officio chairman, the
Secretary of Education as ex-officio vice-chairman, and as ex-officio members: the
Chairman of the National Economic Council, the Secretary of Agriculture and Natural
Resources, the Secretary of Social Welfare, the Secretary of Community Development,
and the Chairman of the National Science Development Board; and the Director-
General of the Council who shall have no vote. In addition, the President shall appoint
the following members from the private sector with the consent of the Commission on
Appointments: two representatives of national organizations of industry; two
representatives of national labor organizations; and two from national family and youth
organizations for a term of three years and shall be and payment of travelling and
necessary expenses incurred in connection with their duties therewith. The Council shall
meet as often as may be necessary, but not more often than thirty times within one
year.

An increase in hiring of workers in the services and agriculture sectors resulted in better
employment levels for the Philippines in July 2019 as well as lower underemployment,
the National Economic and Development Authority (NEDA) said on Tuesday.
In a statement, NEDA said that the Labor Force Survey of the Philippine Statistics
Authority for July showed that employment rate increased by 5.7 percent in July 2019,
from 1.2 percent in July 2018.

This translates to 2.3 million additional employment, almost five times the 479,000
employment generated in the same period last year.
/TSB
MinWage
log employment =∝ logreal GDP+¿ β log + constant +Seasonal❑ ¿The jobless rate
Price Index
has been fairly steady around 5 percent for more than a year, down from 6.6 percent
two years ago. A closer look at the data shows more than 750,000 Filipinos aged 15 or
above dropped out of the labor force last year. That means some 28 million people, or
about 40 percent of the working-age population, aren’t employed and aren’t looking for
jobs.
“Most of the youth stayed out of the labor force,” Socioeconomic Planning Secretary
Ernesto Pernia told reporters in Manila. “Boys cited staying in school as their reason for
not working.”
Unemployment Factors:
1. Net Change in Job Market Status
2. Job Creation
3. Wage Determination

At first glance, that would seem like a major drag on growth. But a better-educated work
force would be a significant boost down the line for a country that counts population size
as a major driver of its economy. Traditionally, young Filipino men have worked without
pay on family farms or earn meager salaries for manual labor at construction sites,
markets or ports.