How Employers Can Adapt to the 2023 Philippine Employment Outlook and Spur Growth
In 2023, the Philippine economic and employment outlook has a generally positive forecast. This is encouraging news for businesses striving to recover from the pandemic’s effects. Positive growth is also expected to prevail in the ASEAN region.
However, global and local conditions still remain uncertain and this volatility could affect the jobs market. This year, employers in the Philippines should learn to adapt and modernize their practices to stay competitive.
By integrating the right technologies, providing flexible working conditions, creating an encouraging workplace culture, and prioritizing employee health, employers can maximize the potential of their staff and ensure their companies continue to grow and succeed this year.
ASEAN Economic Outlook 2023
Analysts suggest a good outlook for the region, but warn that worsening global conditions and tightening monetary policies may cause economic growth rates to fall slightly this year.
Despite a challenging macroeconomic environment, the ASEAN region is expected to continue to be attractive to foreign direct investments, and will remain one of the fastest-growing regions of the world in 2023, at around 4.7 percent growth, according to the Asian Development Bank, and 4.4 percent, according to Credit Suisse.
These figures, while lower than those for 2022, are still higher than the global average for 2023, which the International Monetary Fund has estimated at 2.7 percent.
S&P Global Analysts predict that countries whose economies are reliant on domestic demand, such as the Philippines and Indonesia, will see at least 5 percent growth in 2023. Goldman Sachs puts real GDP estimates for the Philippines and Vietnam at 5.8 percent, the highest in ASEAN.
The prospect of positive growth in ASEAN is likely to lead to more job opportunities of better quality, particularly in the fields of technology and engineering.
Philippine Economic and Employment Outlook 2023
This year could see the pandemic’s effects on the economy and labor diminish as restrictions are continually eased and the country’s economy continues to recover.
However, the National Economic and Development Authority (NEDA) said the economy faces a slowdown compared to previous projections due to the effects of the Russia-Ukraine war, natural disasters that affect agricultural production, sustained inflation, rising interest rates, and other factors.
Here is some information related to the country’s employment outlook, and what it means for employers:
Lower unemployment rate
The government recorded the country’s unemployment rate at 4.2 percent in November 2022, the lowest the country has tracked since April 2005. The employment rate increased to 95.8 percent or an additional 4.2 million employed persons.
What this means: NEDA Sec. Arsenio M. Balisacan said, “The strong labor market signifies the steady recovery of our economy.”
Higher labor force participation rate
The labor force participation rate, according to NEDA, increased to 67.5 percent in November 2022 from 64.2 percent in the same month last year.
What this means: This indicates “a more dynamic labor market as flexible work arrangements and digitalization provide easier access to employment opportunities to Filipinos,” Balisacan said.
Lower underemployment rate
The underemployment rate dropped to 14.4 percent from 16.8 percent, an equivalent of 457,000 fewer people underemployed.
What this means: This suggests a higher demand for labor and for certain job skills. However, there are still many who are underemployed and they represent a talent pool for recruiters to choose from.
Implementation of the Philippine Development Plan 2023-2028
According to NEDA, this is a plan for “deep economic and social transformation” meant to jumpstart job creation and hasten poverty reduction “by steering the economy back on a high-growth path.”
What this means: The government seeks to build an environment that provides inclusive growth, equipping Filipinos with skills to fully participate in a globally competitive economy.
What The Employment Outlook Means for the Jobs Market in 2023
More competitive job market
The Philippine job market is projected to be more competitive in 2023, driven by the inflow of foreign investments that will create new opportunities for growth. However, in the short-term, the influx of foreign investments and increased competition may negatively impact some local businesses.
Larger talent pool
A larger pool of educated and highly-skilled professionals will be available for employers to choose from, but gaps in talent may occur as employers increasingly seek employees with more specialized skill sets. Employers should consider tapping into the influx of new graduates in the job market.
Increased productivity, a strong economy, and a growing middle-class will likely fuel job growth in the Philippines in 2023 and beyond. These trends may also result in higher wages as employers will be encouraged to offer competitive salaries to attract the right talent.
Check out our Salary Report for tips on how to hire better.
How Employers Can Adapt to Changing Conditions
As the global economic landscape continues to shift, Philippine employers should prepare for the changes coming in 2023. Adapting their current hiring and working practices to meet the needs of 21st-century workers should be a priority.
Staying updated with HR technology
HR technology is becoming more advanced. The use of artificial intelligence, the Internet of Things, mobile applications, and other tools that gather, process, and analyze big data and information will become more common as companies embrace new developments.
Managing increased workforce fluidity
Employers must be prepared to hire talent from around the country and even around the world, as practices such as the gig economy and remote working become more prevalent. This means reevaluating recruitment strategies and developing employee retention plans and flexible working conditions to attract and retain top talent.
Practicing agile workforce management
This strategy aligns talent supply and talent demand to business priorities. Employers should plan talent and workforce needs in relation to the short-, medium-, and long-term needs of the organization and its business operations. This allows employers to quickly adapt to possible changes in the business environment while minimizing financial impact.
Establishing an ethical workplace culture
Setting up a workplace culture that emphasizes diversity, inclusion, and respect for all employees and stakeholders will be essential for companies to thrive in a changing economic landscape. Observing good ethical practices and providing a safe and inclusive space for employees to work and grow will be integral to the success of a company as it encourages stronger employee engagement and retention.
Recognizing the importance of employee health
in the face of stress from increasing workloads, employers in the Philippines must recognize the importance of managing their employees’ mental and physical health. Implementing wellness programs and providing resources to help with managing stress, mental health, and physical health conditions will be key to enhancing worker productivity.
Overall, the Philippine employment outlook for 2023 provides reason for optimism and could lead to great opportunities for both local businesses and workers. As the job market continues to evolve, employers who are prepared to adapt and change will be poised for success and sustainability.
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