THE PHILIPPINE
LABOR MARKET
Reporters name
This section covers the
domestic labor market.
Remember that labor is a
factor of production that
earns factor income through
wages.
What is Labor Force?
Refers to the
number of
people
identified as
employed or
unemployed
TYPES OF LABOR FORCE
EMPLOYED UNEMPLOYED
UNDEREMPLOYED
EMPLOYED
The term employed
represents those individual
who have a job either full-
time or part-time capacity
UNEMPLOYED
The term unemployed, on the
other hand, refers to the
people who are presently
search for a job, worker who
are temporarily laid off but are
waiting to be called back for a
job, and applicants who are
about to start a new job.
UNDEREMPLOYED
Underemployed describe
those workers who are better
skilled than what their current
jobs require
WHAT IS POPULATION
GROWTH?
Population growth is
the increase in the
total of human beings
in the country.
A census of the official
collection of population
information, is locally
conducted once every
five years by the
Philippine Statistics
Authority (PSA).
HOW DOES POPULATION
GROWTH AFFECT THE LABOR
FORCE?
An increase in population
potentially increases the labor
supply. However, the impact of
population growth largely
depends on the increase in the
number of adult population.
The Labor force
participation rate
approximates the
percentage of the
population that is
actually part of the
labor pool.
The working age in the
Philippines is 15 to 64
years old.
UNEMPLOYMENT AND WAGES
Full employment is another
macroeconomic goal of a nation. In
reality, however, there are imbalances in
the economy (also known as market
failures) that make it impossible to
achieve a state of zero unemployment.
The unemployment rate measures the percentage of
individuals in the labor force who do not have a job. It is
calculated using equation 4.2.
4 TYPES OF UNEMPLOYMENT
FRICTIONAL
UNEMPLOYEMENT
STRUCTURAL
UNEMPLOYEMENT
CYCLICAL
UNEMPLOYEMENT
SEASONAL
UNEMPLOYEMENT
FRICTIONAL
UNEMPLOYEMENT
The first type is frictional unemployment,
which is temporary unemployment that is a
result of people being in between jobs or being
in transition.
STRUCTURAL
UNEMPLOYEMENT
The second type is structural unemployment,
which is a type of unemployment that results
from technology changes and upgrades that
require specialized skills. This is also driven by
location and proximity.
CYCLICAL
UNEMPLOYEMENT
Cyclical unemployment is the component of
overall unemployment that results directly
from cycles of economic upturn and
downturn. Unemployment typically rises
during recessions and declines during
economic expansions.
SEASONAL
UNEMPLOYEMENT
The last type is seasonal unemployment,
which happens in industries with peak and
lean seasons
WAGE AND SALARIES
• Just as businesses earn profit in exchange for
goods and services, factors of production earn
what is called as factor income.
WHAT IS THE
DIFFERENCE
BETWEET WAGE
AND SALARY?
Wage- is what a worker gets as compensation for hours
of labor. More formally, wage measures the amount of
return (money) per hour of input (labor).
Salary- refers to the aggregate amount received.
Salaries in the Philippines are normally paid on a
monthly or bi-monthly (ie., 15th and 30th) basis.
• Minimum wage is the least
possible amount firms
must pay their employees
as mandated by the
country's labor laws.
• Wage and profit of a
firm are negatively
correlated.
• Filipinos working abroad are formally
referred to as overseas Filipino workers
(OFWs). Choosing to work in a foreign
country is the concept of labor migration.
• Globalization is another driver of
increased labor migration.
Labor policies in the Philippines
are governed by the labor code
implemented by government
agencies such as DOLE for
locally employed individuals
and the Philippine Overseas
Employment Administration
(POEA) for OFWS.
