MANILA, Philippines — The Department of Labor and Employment (DOLE) has attributed the recent spike in the country’s unemployment rate to the expiration of temporary “holiday jobs” following the peak year-end season. Data from the latest Labor Force Survey revealed that unemployment surged to 5.8%, a figure not seen since the height of the pandemic, raising concerns about the stability of the Philippine labor market.
According to DOLE officials, the rise from previous months is largely “seasonal” rather than “structural.” Thousands of workers who were hired for short-term contracts in the retail, logistics, and hospitality sectors during the Christmas and New Year period saw their employment end as businesses scaled back operations in the first quarter of 2026.
“What we are seeing is the natural tapering off of the seasonal labor demand,” a DOLE Undersecretary explained. “During the holidays, there is a massive influx of temporary roles to handle the surge in consumer spending. When those contracts expire in January and February, those individuals are transitioned back into the pool of the unemployed as they search for their next long-term opportunity.”
Despite the 5.8% headline figure, the department emphasized that the quality of employment is improving, with a slight decrease in the underemployment rate. This suggests that while more people are currently looking for work, those who are employed are securing more stable, full-time hours compared to previous years.
However, independent economic analysts warn that seasonality may not be the only factor at play. The “mounting pressure” from high fuel costs and rising inflation may be forcing some small and medium enterprises (SMEs) to freeze hiring or reduce their workforce to manage operational expenses. The manufacturing and construction sectors, in particular, have shown a slower-than-expected recovery in job creation.
In response to the data, the government is fast-tracking several employment-facilitation programs. DOLE is coordinating with the Department of Trade and Industry (DTI) to hold nationwide job fairs focusing on high-growth sectors such as BPO, renewable energy, and digital infrastructure. Additionally, the administration is pushing for the “re-skilling” of displaced seasonal workers to help them transition into more permanent roles in the emerging “green economy.”
As the second quarter begins, labor officials remain optimistic that the unemployment rate will stabilize as the “summer peak” in tourism and the rollout of several large-scale infrastructure projects under the national budget begin to absorb the excess labor supply.