MANILA — The sustained strength of the country’s labor market was evident in 2024 as the year-to-date unemployment rate dropped to 4.0%—well below the full-year target range of 4.4% to 4.7%.
With this, the total number of Filipinos employed rose to 48.6 million from January to October 2024.
Wage and salary workers, or those involved in formal and stable jobs, continued to make up the largest share of employed persons in the country at 63.8%.
PH achieves an all-time high GNI per capita, reflecting improved standards of living
Along with the strong labor market, the Philippines achieved an unprecedented gross national income (GNI) per capita of USD 4,335 or PHP 241,165 in 2023 as more and better economic opportunities are available for Filipinos.
GNI per capita measures the economic output per citizen, including both domestic and international earnings. A higher GNI per capita means greater economic prosperity and an increased standard of living.
This puts the Philippines on track to achieve an upper-middle-income status next year, which the World Bank defines as countries having GNI per capita ranging between USD 4,516 and USD 14,005 for 2025.
Prices remain broadly stable, growth momentum strengthened by rate cuts
The country’s year-to-date inflation rate of 3.2% has stayed firmly within the DBCC’s assumption of 3.1% to 3.3%, reflecting the government’s effective interventions to ease supply pressures for key food items, especially rice.
In particular, rice inflation has continued its downtrend from 22.5% in June 2024 to 5.1% in November this year as a result of the implementation of Executive Order (EO) No. 62 in July 2024, which lowered import tariffs on rice.
The continued drop in rice prices, including the set up of more Kadiwa Stores nationwide, has benefitted the bottom 30% of households as headline inflation for the said group declined to 2.9% in November 2024 from 5.8% in July.
The overall inflation rate is expected to average 3.1% to 3.3% for the full year, significantly lower than 6% in 2023.
This favorable domestic inflation outlook allowed the Bangko Sentral ng Pilipinas (BSP) to be the first in ASEAN to start its monetary policy easing, cutting policy interest rates to a cumulative 50 basis points (bps) and slashing reserve requirements across all financial intermediaries by 250 bps to boost growth.
New laws signed to boost investments and revenues, revitalize tourism, and strengthen food security
The DOF’s priority reform measures advanced well in Congress in 2024. Among those successfully enacted that will fast-track the entry of more foreign investors into the Philippines include the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act and the Public-Private Partnership (PPP) Code.
Meanwhile, among the priority revenue reform measures signed into law were the Ease of Paying Taxes (EOPT) Act, the Value-Added Tax (VAT) on Non-Resident, the Real Property Valuation and Assessment Reform Act, and the VAT Refund Mechanism for Non-Resident Tourists Act. All these will boost revenue collection and bring the Philippine tax system to par with global standards.
The President also signed into law the Amendments to the Agricultural Tariffication Act which enhances the capabilities of the government to protect Filipino consumers by extending market interventions to stabilize rice prices during periods of volatility and to prevent manipulative pricing and hoarding.
The rest of the DOF’s revenue reforms are in the advanced stages in Congress, namely the Rationalization of the Fiscal Mining Regime, the Excise Tax on Single-Use Plastic Bags, Package 4 of the Comprehensive Tax Reform Program, and the Motor Vehicle Road User’s Tax.
More Filipinos lifted out of poverty in 2023, on track to reduce incidence to a single-digit by 2028
All the strategic growth-enhancing initiatives undertaken by the Marcos, Jr. administration are aimed at achieving the most important number, which is cutting poverty incidence to a single digit or 9% by 2028.
In 2023, the administration successfully reduced poverty incidence among Filipino individuals to 15.5% from 18.1% in 2021, and the pre-pandemic rate of 16.7% in 2018. This means that 2.40 million Filipinos were lifted out of poverty from 2021 to 2023.
The figure is lower than the government’s target of 16.0% and 16.4% for the year, putting it on track to hit its goal of lifting eight million more Filipinos out of the poverty line by 2028.
A recent Macro Poverty Outlook for the Philippines released by the World Bank projected that the country could cut its poverty incidence to 9.3% in 2026—two years ahead of the 2028 target with the continuous improvement in the labor market and the easing of the inflation rate. (DOF)
