President Ferdinand Marcos Jr. has signed Republic Act 12063, the Enterprise-Based Education and Training (EBET) Framework Act, to address the job-skills mismatch and to enhance employment opportunities in the country.

The law introduces a framework to better align the country’s education system with industry demands, tackling issues of unemployment, underemployment, and the skills gap.

In a statement, Marcos emphasized that the law would help provide workers with relevant skills training and foster a globally competitive workforce.

“We are answering the call for quality employment and fostering a future-ready workforce,” he said.

The EBET Act encourages private sector involvement by offering fiscal incentives to companies that implement training programs.

Businesses can deduct up to 50 percent of training expenses from their taxable income, while donations to vocational institutions or EBET programs are tax exempt.

Enterprises will also be assisted by EBET support integrators to design training programs and analyze market trends, especially for micro and small enterprises.

Senator Joel Villanueva, principal author of the bill, said the law would bridge the gap between education and industry, giving more job opportunities to Filipinos.

“We are aligning education with market needs, boosting innovations in AI readiness and other emerging technologies,” Villanueva said.

He said that while the unemployment rate dropped to 3.5 percent in September, underemployment remained a challenge, with its increase to 11.9 percent signaling the continued mismatch between job skills and market demands.

The EBET Act aims to improve the Technical and Vocational Education and Training (TVET) system, integrating enterprise-based programs to provide students with real world skills.

These programs include apprenticeships, learnerships, and dual training systems, which will be harmonized under the new framework.

Evolving industries

Senator Sherwin Gatchalian, co-author of the measure, said the EBET programs would equip workers with the skills required by evolving industries.

He noted that despite efforts, enterprise-based training has remained underutilized in the TVET sector, with only nine percent of TVET enrollment in 2022 participating in such programs.

The law aims to increase this figure and ensure that the training is aligned with rapidly changing industry needs.

The Philippine Business for Education (PBEd) lauded the EBET Act, calling it a “game-changer” for technical-vocational graduates.

PBEd Executive Director Justine Raagas highlighted the importance of involving industries directly in skills development to ensure that graduates are job ready.

The law also seeks to create a seamless path from senior high school (SHS) to TVET programs, addressing the call for better integration between education and employment.

The law also includes provisions for three types of EBET programs:

1. General EBET is for low to mid-level skills, including those without corresponding National Certificate (NC) levels.

2. Apprenticeship programs are for higher-level competencies, with trainees receiving a training allowance of at least 75 percent of the minimum wage.

3. The third provides upskilling programs to enhance the skills of current employees, regardless of their NC level.

Marcos said the law will contribute to a more adaptable and future ready workforce, responding to the evolving needs of the global economy.

The law is expected to improve the job prospects of TVET graduates, who already have a high employment rate, with eight of 10 TVET graduates securing good jobs.

Strong partnerships with industry leaders have been credited for this success, ensuring that graduates are equipped with competitive, relevant skills.