Why is Unemployment High in the Philippines?

IMF Working Papers, February 1, 2002

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Why is Unemployment High in the Philippines?

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Bibliographic details

• Authors: R. Brooks
• Published: February 1, 2002
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781451844054.001

Overview

• Unemployment has remained high in the Philippines, at almost twice the level of neighboring countries, despite relatively fast employment growth in the past decade.
• Employment growth was not sufficient to reduce unemployment because of rapid population growth and increased labor force participation.

Key findings

• Philippine employment growth and unemployment declines were positively correlated with real GDP growth.
• Employment growth and unemployment declines were, to a lesser extent, negatively correlated with the real minimum wage.
• Rapid population growth and increased labor force participation offset employment gains.

Empirical relationships and variables examined

• Real GDP growth: positively correlated with employment growth and unemployment declines.
• Real minimum wage: negatively correlated (to a lesser extent) with employment growth and unemployment declines.
• Other variables and keywords noted: adjusted unemployment rate, employment equation, employment growth, GDP deflator, job search, minimum wage variable, Minimum wages, Philippines, Philippines labor market indicator, unemployment, Unemployment rate, WP.

Policy implications and recommendations

• Higher economic growth is required to reduce unemployment.
• Moderation of increases in the real minimum wage is required to reduce unemployment.

Content in this bundle

• Why Is Unemployment High in the Philppines? - WP/02/23
  • Why Is Unemployment High in the Philppines? - WP/02/23 (Markdown version)
  • Why Is Unemployment High in the Philppines? - WP/02/23 (PDF)