Unemployed Filipinos down to 3.07 million in July 2021

The number of unemployed Filipinos eased to 3.07 million in July, the Philippine Statistics Authority (PSA) said Tuesday.

PSA said this was lower than the 4.14 million unemployed Filipinos recorded in April 2021 and the 4.57 million in July 2020.

According to the agency, the unemployment rate in July 2021 was estimated at 6.9 percent and is “the lowest since the pandemic in April 2020.” It was also lower than the 7.7 percent unemployment rate in June when there were 3.8 million unemployed Filipinos.

PSA said six regions registered unemployment rates higher than the national estimate of 6.9 percent.

These are Metro Manila (9 percent), Central Visayas (8.8 percent), Bangsamoro Autonomous Region In Muslim Mindanao (8.2) percent, Bicol Region (7.9 percent), Calabarzon (7.7 percent) and Mimaropa (7.1 percent).

Meanwhile, the country’s employment rate was pegged at 93.1 percent in July, compared to 90 percent in June. Employed persons were estimated at 41.7 million in July, compared to the 45.1 million in June.

LFPR in July fell to 59.8 percent, equivalent to 44.7 million Filipinos who were either employed or unemployed. PSA said the July labor force participation rate (LFPR) is the lowest so far this year.

On the other hand, the number of underemployed persons was estimated at 8.7 million in July 2021 or 20.9 percent of the 41.7 million employed individuals during the month.

This is the highest underemployment rate since the pandemic in April 2020, according to PSA.

By industry group, the services sector still had the largest share of employed persons at 57.9 percent, followed by the agriculture sector at 22.1 percent. The industry sector had the least share of employed persons at 20 percent.

Employed individuals in the industry and services sectors rose by 7.2 percent and 6.6 percent, respectively, from July 2020 to July 2021. However, workers in the agriculture sector decreased by 15.5 percent.

LFPR was higher among men at 72.4 percent compared to women at 47.1 percent. Employment rate was 93.7 percent among men and 92.3 percent among women. But the unemployment rate among men was lower at 6.3 percent than among women at 7.7 percent.

Meanwhile, LFPR among youth in July 2021 decreased to 33.3 percent from the reported 38.9 percent in July 2020. Employment rate among youth increased by 7.0 percentage points from 77.6 percent in July 2020 to 84.6 percent in July 2021.

Source: PSA

The Philippines’ inflation rate surges to 4.9% in August.

The headline inflation at the national level jumped to 4.9 percent in August 2021, from 4.0 percent in July 2021. This is the highest inflation recorded since January 2019.

With the August 2021 inflation, the Philippines’ average inflation from January to August 2021 stood at 4.4 percent.

In August 2020, inflation rate was lower at 2.4 percent.

The uptrend in the country’s inflation was mainly brought about by the higher annual increment in the index of the heavily-weighted food and non-alcoholic beverages at 6.5 percent during the month, from 4.9 percent in July 2021.

Moreover, recreation and culture index went up by 0.5 percent in August 2021, after recording annual decreases since August 2020.

Annual increases were also higher in the indices of the following commodity groups:

• Alcoholic beverages and tobacco, 10.3 percent;

• Clothing and footwear, 1.8 percent;

• Housing, water, electricity, gas, and other fuels, 3.1 percent;

• Furnishing, household equipment and routine household maintenance, 2.5 percent;

• Transport, 7.2 percent; and

• Restaurant and miscellaneous goods and services, 3.8 percent.

The other commodity groups, i.e., health, communication, and education, retained their previous month’s annual growth rates.

Excluding selected food and energy items, core inflation, likewise, picked up to 3.3 percent in August 2021, from 2.9 percent in July 2021. In August 2020, core inflation was posted at 3.1 percent.

For food index, the annual growth rate at the national level accelerated to 6.9 percent in August 2021, from 5.1 percent in July 2021. It was observed at 1.7 percent in August 2020.

By specific food item, double-digit annual growth rates were noted in the indices of meat at 16.4 percent; fish, 12.4 percent; and vegetables, 15.7 percent.

Annual hikes were also higher in the indices of the following food groups:

• Corn, 8.7 percent;

• Other cereals, flour, cereal preparations, bread, pasta, and other bakery products, 1.8 percent;

• Oils and fats, 4.8 percent;

• Sugar, jam, honey, chocolate and confectionery, 1.2 percent; and

• Food products not elsewhere classified, 1.6 percent.

Moreover, inflation for fruit inched up to 0.1 percent, from an annual drop of -0.6 percent in the previous month. Furthermore, the annual decline of -0.4 percent in rice index during the month was slower relative to its previous month’s annual decrease of -1.0 percent.

Meanwhile, milk, cheese and egg index retained its previous month’s annual growth of 0.6 percent.

Source: PSA

Commercial property price index to help ensure financial stability

The central bank’s upcoming commercial property price index (CPPI) will help it gauge the impact of the coronavirus crisis on the real estate industry and give the regulator another indicator to monitor in fulfilling its financial stability mandate.

“It is crucial to monitor the commercial property prices and the commercial real estate sector during this crisis and as we move towards the new economy is the adverse effects of the pandemic on the outlook for the real estate sector,” the Bangko Sentral ng Pilipinas (BSP) said.

The CPPI will include details such as the actual use of a commercial property and appraised land value. Its bank-level data will include indices for commercial properties within Metro Manila and their uses such as office, retail, mixed use, and commercial vacant lot.

The BSP announced in June that it will release its first CPPI within the year, which will be patterned after its quarterly residential real estate price index (RREPI).

The Philippines is one of 59 countries that release quarterly RREPI data. This came after experts, following the Global Financial Crisis, said some indicators in the property sector could serve as warnings for a potential economic downturn.

While the consumer price index is the main indicator considered by the BSP when setting policy as an inflation-targeting central bank, it said the CPPI will also help it ensure the financial system’s stability.

“A wide set of economic variables is also taken into account in the BSP’s policy-making decisions regarding the appropriate stance of monetary policy, with the view to maintaining price stability conducive to sustainable growth and employment. These include monitoring the trends in the Philippine property sector,” the BSP said.

The price index for the commercial real estate sector could also be used as “an indicator of macroeconomic activity; an input to socioeconomic policies such as monetary and financial policies, and a basis for investment decisions and cross-country comparisons,” the central bank added.

The CPPI would also help the BSP assess how its policies affect the real estate sector, it said.

“A loose monetary policy could encourage a shift of capital flows into the real estate, which in turn could exert pressure on real estate prices to rise,” the BSP said. “Conversely, a hike in policy rates lowers the value of asset holdings of individuals and financial institutions, it could potentially make credit financing more costly for both buyers and property suppliers.”

The Financial Stability Coordination Council in July said the commercial real estate industry is among the sectors that will see a significant change in the “new normal” due to work-from-home and health protocols.

Officials noted that the exodus of foreign workers is a growing concern as they mainly drove demand for office space before the pandemic. They also noted the need to retrofit existing spaces and improve ventilation in order to comply with physical distancing and health protocols.

Residential property prices declined in the first quarter, mainly dragged by the lower costs of condominium units and duplexes due to weak demand amid the crisis. The RREPI was down by 4.2% year on year in the January to March period, the steepest decline recorded since the index was launched in 2016.

Source: BusinessWorld