The Philippines saw a slight improvement in unemployment in March 2026, but underlying labor market conditions suggest that job quality and stability remain pressing concerns, according to the latest Labor Force Survey of the Philippine Statistics Authority (PSA). 

Data showed the unemployment rate dipped to 5.0 percent from 5.1 percent in February, equivalent to about 2.58 million Filipinos without jobs. However, this figure remains significantly higher than the 3.9 percent recorded a year earlier, indicating that recovery in employment has yet to fully stabilize.

At the same time, more Filipinos entered the workforce, pushing the labor force participation rate to 63.3 percent, or 51.65 million individuals aged 15 and above. This is higher than last year’s level but slightly below February’s participation rate, reflecting modest shifts in workforce engagement.

Despite the easing jobless rate, the employment picture was mixed. The total number of employed Filipinos reached 49.07 million, up from a year ago but lower than the previous month. The employment rate stood at 95.0 percent, still below last year’s 96.1 percent, suggesting that while jobs are being created, they are not keeping pace with labor force growth.

The services sector remained the country’s main source of jobs, accounting for 63 percent of total employment, followed by agriculture and industry. Retail trade, farming, and construction continued to employ the largest share of workers, underscoring the economy’s reliance on both consumption-driven and labor-intensive activities.

However, sectoral shifts reveal uneven growth. Transportation, administrative services, and professional sectors posted the largest annual job gains, signaling expansion in logistics and knowledge-based industries. In contrast, fishing, manufacturing, and public administration recorded the biggest declines, pointing to structural and environmental challenges affecting traditional and production-based sectors.

Short-term movements also reflected volatility. Month-on-month, agriculture and construction added the most jobs, while fishing and manufacturing saw sharp losses, highlighting the sector’s sensitivity to seasonal and external factors.

A closer look at job quality shows continuing vulnerabilities. Underemployment—those seeking more hours or additional work—rose to 12.3 percent from the previous month, affecting over 6 million workers. This suggests that many Filipinos, while employed, are not earning enough or working sufficient hours.

Wage and salary workers made up the majority of the workforce at 63.7 percent, with most employed in private establishments. Self-employed individuals and unpaid family workers still comprised a substantial portion, reflecting the prevalence of informal and less secure work arrangements.

Working hours also edged down slightly to an average of 40.7 hours per week, further indicating limited expansion in full-time opportunities.

Among the youth, participation in the labor force improved compared to last year, but employment outcomes remained weaker. The youth employment rate declined year-on-year, while underemployment affected more than 13 percent of young workers, highlighting challenges in securing stable and adequate jobs early in their careers.