1.

Not enough jobs for an ever-expanding population

One reason is that job creation has struggled to keep pace with an ever-
expanding population. In three of the past five years, the number of people
entering the job market has been greater than the number of jobs created.

The conundrum highlights the difficulty of spreading the benefits of economic

growth and suggests they have yet to trickle down to more deprived areas.

Participation in the labor force remains relatively low. Only about 65 per cent
of the population aged 15 and above is looking for work, one of the lowest
levels in the region. This compares with 78 per cent in Vietnam, 72 per cent in
Thailand and 68 per cent in Indonesia.

2. Majority of the young Filipinos go to college before entering the labor

market

This is partly explained by the high value set on further education in the
Philippines: young Filipinos typically spend some time in college before
entering the labor market, contributing to the lower participation rate. Others
in the region go to work earlier.

3. Jobs available are of low quality

Another factor may be the low quality of jobs available. Last year, just 58 per
cent of workers in both formal and informal employment were in what
were described as paid jobs. Of the rest, 28 per cent were self-employed, with
no guaranteed income, and 11 per cent worked on family-owned farms or
other businesses where they typically receive food and lodging but no actual
cash, according to official statistics.

Benjamin Diokno, an economist at the University of the Philippines and

former budget minister, says this relatively large number of unpaid workers
about 4 million people "bloats" the ranks of the employed and makes
unemployment appear less serious than it is.

Reference: https://www.cnbc.com/2015/09/01/unemployment-in-
philippines-an-issue-despite-rapid-economic-growth.html

4. Unsuccessful structural transformation

Instead of rising agricultural productivity paving the way for a vibrant labor-
intensive manufacturing sector and eventually a high-skills services sector,
the opposite has happened. Agricultural productivity has remained depressed,
manufacturing has failed to grow sustainably despite a head start (see
Figure 1) and a low-productivity, low-skill services sector has emerged as
the dominant sector of the economy. This is in sharp contrast to nearby
countries such as China, Indonesia, and Vietnam, where labor reallocation
across sectors, particularly toward light manufacturing for exports, has made
large contributions to labor productivity growth. Instead of rising labor-
intensive manufacturing driving up job creation and real wages, Filipino
workers have moved out of agriculture to become increasingly concentrated
in low-skill, low-pay, informal service sector jobs (see Figure 2).
References: http://blogs.worldbank.org/jobs/governance/why-philippines-failed-
create-enough-and-good-jobs