The Philippine labor market showed signs of improvement in February 2025 compared to the previous month, but still faces challenges compared to the same period last year. According to the Labor Force Survey results released by the Philippine Statistics Authority (PSA), the employment rate in the Philippines was 96.2% in February 2025. This is a slight decrease from the 96.5% recorded in February 2024, but an increase from the 95.7% in January 2025.

The number of employed persons in February 2025 was 49.15 million, a slight increase from 48.49 million in January 2025 and 48.95 million in the same month last year. This suggests that the Philippine economy is showing a gradual recovery and that new jobs are being created.

The labor force participation rate also showed a positive change. In February 2025, the labor force participation rate was 64.5%, which represents the proportion of the population aged 15 years and over who were either employed or unemployed. This is slightly lower than the 64.8% in the same month last year, but higher than the 63.9% in January 2025. This indicates a steady increase in the population willing to participate in the labor market, with the total labor force reaching 51.09 million, up from 50.75 million in February 2024 and 50.65 million in the previous month.

The average weekly hours worked by employed persons in February 2025 was 41.1 hours, an increase compared to 40.1 hours in February 2024 and 40.4 hours in January 2025. This indirectly indicates that existing employees are working longer hours or that labor demand is increasing. However, in February 2025, about 73,000 individuals (0.15% of the total employed) worked for only one hour per week, raising concerns about precarious employment. This is a slight increase from 52,000 (0.11%) in the same month last year and 59,000 (0.12%) in the previous month.

Encouragingly, the underemployment rate showed a significant decrease. In February 2025, the underemployment rate was 10.1%, a substantial drop from 12.4% in February 2024 and 13.3% in January 2025. This means that the proportion of employed individuals wanting additional work hours or better jobs has decreased, which can be interpreted as a positive sign in terms of employment quality. Among the 49.15 million employed in February 2025, about 4.96 million expressed a desire for more work.

Looking at the employment situation by industry, the services sector continued to hold the largest share of total employment at 61.6%. This was followed by agriculture (20.1%) and the industry sector, including manufacturing (18.3%). Notably, significant employment increases were observed in accommodation and food service activities (+377,000), fishing and aquaculture (+365,000), public administration and defense, compulsory social security (+330,000), construction (+258,000), and other service activities (+232,000). On the other hand, considerable employment declines were seen in agriculture and forestry (-949,000), administrative and support service activities (-201,000), transportation and storage (-158,000), wholesale and retail trade; repair of motor vehicles and motorcycles (-77,000), and professional, scientific and technical activities (-68,000).

Comparing employment changes from the previous month, the largest increases were in wholesale and retail trade; repair of motor vehicles and motorcycles (+620,000), construction (+434,000), manufacturing (+225,000), public administration and defense, compulsory social security (+191,000), and fishing and aquaculture (+147,000). Conversely, significant decreases were noted in agriculture and forestry (-520,000), administrative and support service activities (-308,000), transportation and storage (-176,000), professional, scientific and technical activities (-90,000), and information and communication (-89,000).

In terms of employment class, wage and salary workers accounted for the largest share of total employment at 63.2%, followed by self-employed without any paid employee (28.2%), unpaid family workers (6.6%), and employers in own family-operated farm or business (2.0%). The majority of wage and salary workers (77.3%) were employed in private establishments, while those working in government or government-controlled corporations accounted for 14.7%.

Meanwhile, the labor force participation rate among the youth remains a concern. In February 2025, the labor force participation rate for the 15 to 24-year-old age group was 31.1%, a decrease from both 33.8% in February 2024 and 31.8% in January 2025. The youth employment rate also decreased to 89.6%, compared to 91.4% in the same month last year. This indicates that young people are still facing difficulties entering the labor market and finding quality jobs.

In conclusion, while the Philippine labor market showed positive signs in February 2025 with an expansion in overall employment and a decrease in the underemployment rate, the slight year-on-year decline in the employment rate, job losses in some industries, and particularly the low labor force participation and employment rates among the youth remain challenges that need to be addressed. The Philippine government must continue to strive for policies that improve the quality of employment and actively encourage youth participation in the labor market, alongside sustained economic growth.