The government will ramp up support for micro, small, and medium enterprises (MSMEs) and enhance worker employability to curb the soaring unemployment rate, which hit 6 percent last July amid a surge of new workforce entrants and the ongoing Middle East crisis, according to Malacañang.
Citing the Department of Economy, Planning, and Development (DEPDev), Palace Press Officer Claire Castro attributed the spike to inability of the labor force to absorb the large number of available workers.
Last July, she said the country’s labor force expanded to 52.36 million while total employment only grew to 49.21 million.
The Presidential Communications Office undersecretary said the number of overseas Filipino workers (OFW), who were displaced in the Middle East conflict, also contributed to the unemployment, which reached 3.14 million last month.
To address the issue, Castro said the Marcos administration will improve ease of doing business and give more tax breaks to the private sector so the country can generate more jobs.
‘Because when investors can secure requirements more quickly, it is easier for them to enter the market and hire our fellow Filipinos for their businesses,’ Castro said in Filipino in a press briefing last Wednesday.
Tax breaks, she said, can also allow companies to expand their businesses so they employ more people.
Castro said the government also continues to reform the National Education and Workforce Development Plan for 2026 to 2035 based on the Association of Southeast Asian Nations (ASEAN) Mutual Recognition Arrangements for Qualification and Skills Certification to strengthen the capacity of workers.
She said the effects of the changes in education can already be seen in the outcome of the country’s 2025 Programme For International Student Assessment (PISA) results.
Based on results of the 2025 PISA organized by the Organization for Economic Cooperation and Development (OECD), the country scored 373 in science, 371 in mathematics, and 367 in reading.
‘Because of this, the Philippines surpassed 14 countries in Science, 16 in Mathematics, and 18 in Reading,’ Castro said.
‘A 10-year trend analysis by the Organization for Economic Cooperation and Development also showed that the Philippines is the fastest-improving country in terms of reading performance, with significant improvement in mathematics and continued progress in science,’ she added.
The government also continues its jobs facilitation initiatives, by holding nationwide monthly job fairs and improving the services of the Public Employment Service Offices (PESO).
‘Right now, we see the government’s efforts to alleviate the unemployment issue,’ Castro said.
DEPDev projected the country’s unemployment rate this year will be between 5.3 percent and 5.8 percent due to the existing economic headwinds.