Post-holiday job losses drive spike in Philippines’ unemployment rate: DOLE

The Department of Labor and Employment (DOLE) has flagged a seasonal slowdown in the country’s labor market following the release of the January 2026 Labor Force Survey by the Philippine Statistics Authority (PSA), pointing to temporary job losses after the holiday hiring surge.

According to the data, the Philippines’ labor force reached 50.89 million in January 2026, with total employment at 47.94 million. However, employment dipped compared to 48.49 million recorded a year earlier, while unemployment rose to 2.96 million from 2.17 million in January 2025. This pushed the unemployment rate up to 5.8%, from 4.3% in the same period last year.

DOLE attributed the increase largely to the end of short-term holiday jobs, particularly in sectors such as wholesale and retail trade and service-related roles. Employment dropped sharply by 1.489 million from December 2025 to January 2026, with notable declines in retail and sales occupations, industries typically buoyed by year-end demand.

Seasonal factors also weighed on the labor market, including reduced activity in agriculture due to crop cycles and softer demand in construction and rural employment. At the same time, the influx of new job seekers at the start of the year contributed to higher unemployment figures.

Underemployment also rose significantly, reaching 6.34 million or 13.2% of the workforce in January, up from 8.0% in December 2025. DOLE said this reflects reduced working hours after the peak tourism and retail season, with many workers shifting back to part-time or irregular employment while seeking more stable income sources.

Despite the short-term fluctuations, the department highlighted a positive trend in wage and salary employment, which increased by 2.408 million year-on-year to 32.96 million. This signals ongoing improvements in job quality and formal employment.

DOLE emphasized that the broader labor market remains supported by strong macroeconomic fundamentals and continued job generation efforts, aligning with targets under the Philippine Development Plan 2023–2028.

Looking ahead, the agency said it will intensify employment programs under initiatives such as the Philippine Labor and Employment Plan and the Trabaho Para sa Bayan Plan. These include reskilling and upskilling programs, youth employability initiatives, expanded job fairs, and increased support for micro, small, and medium enterprises.

DOLE also plans to promote flexible work arrangements and strengthen support mechanisms to help businesses retain workers during economic adjustments. It underscored the need for sustained efforts to improve job quality, boost productivity in agriculture and value-added industries, and expand workforce participation among women, youth, and older workers.

The department reiterated its commitment to closely monitoring labor market trends and working with stakeholders to ensure employment growth translates into stable, productive, and secure jobs for Filipinos.