Unemployment rate rises to 3.7% in June amid record labor force size

The Philippine unemployment rate climbed to 3.7 percent in June 2025, up from 3.1 percent a year earlier, reflecting a labor market under pressure even as the number of Filipinos joining the workforce hit a record high.

Data from the Philippine Statistics Authority (PSA) showed that 1.95 million individuals were unemployed in June, compared to 1.62 million in the same period last year. However, the latest figure marks a slight improvement from the 2.03 million unemployed reported in May 2025, when the jobless rate stood at 3.9 percent.

Despite the uptick in unemployment, labor force participation remained robust, with 52.42 million Filipinos aged 15 and over either working or actively seeking work – up from 51.90 million a year ago. This is the highest recorded labor force size since April 2005.

The labor force participation rate (LFPR) dipped slightly to 65.7 percent in June from 66.0 percent a year ago and 65.8 percent in May, suggesting that while more Filipinos are entering the job market, a slightly smaller proportion of the working-age population is actively engaged.

Meanwhile, the country’s employment rate stood at 96.3 percent in June, lower than the 96.9 percent posted in June 2024 but marginally higher than May’s 96.1 percent. The number of employed persons rose to 50.47 million from 50.28 million last year.

Underemployment, a persistent concern, improved slightly as the rate fell to 11.4 percent in June, from 12.1 percent in June 2024 and 13.1 percent in May. Still, 5.76 million employed individuals wanted more working hours or better jobs.

The services sector continued to dominate employment, accounting for 61.4 percent of all jobs, followed by agriculture at 20.9 percent and industry at 17.7 percent. Within services, wholesale and retail trade, repair of motor vehicles and motorcycles led with a 21.5 percent share.

Among industries, fishing and aquaculture, financial and insurance activities, and transportation and storage saw the largest annual job gains. However, employment in construction, agriculture and forestry, and manufacturing sectors posted significant annual declines.

Wage and salary workers represented the bulk of employed Filipinos at 63.0 percent, with private establishments accounting for nearly 79 percent of this group.

The average workweek slipped to 40.5 hours in June from 40.9 hours the year before. Additionally, some 64,000 workers were reported to have worked only one hour during the reference week – a slight increase year-on-year.

Youth labor trends also showed strain. The LFPR for those aged 15 to 24 dropped to 33.1 percent in June, down from 33.7 percent in 2024. Youth employment also declined to 90.6 percent, while youth underemployment was pegged at 10.2 percent, affecting around 615,000 young workers.