Labor turnover slows in fourth quarter of 2019 — PSA

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By Jobo E. Hernandez, Researcher

EMPLOYMENT growth among large Metro Manila firms continued to improve in the third and fourth quarter of 2019, the Philippine Statistics Authority (PSA) reported on Friday.

In its latest quarterly Labor Turnover Survey, the PSA said labor turnover in the National Capital Region (NCR) was at 1.9% in the fourth quarter, slower than the 2.8% logged in the third quarter.

This means that for every 1,000 persons employed, large firms were hiring some 19 additional workers on a net basis during the fourth quarter.

The labor turnover rate is the difference between the rate of accession or hiring and the rate of separation or job termination or resignation.

The rate of accession — which represents hiring by employers to either replace former employees or expand their workforce — stood at 6.6% in the fourth quarter, down from 8.6% in the previous quarter.

The rate of separation – which covers termination and resignation — stood at 4.7%, down from the third quarter’s 5.9%.

The services sector posted a net job creation rate of 1.8%, following an accession rate of 6.8% and separate rate of five percent. The highest turnover rates in this sector include accommodation and food service activities (2.9% from 3.7% in the third quarter); administrative and support service activities (2.6% from 6.2%); and arts, entertainment and recreation (2.5% from two percent).

For industry, the labor turnover rate was 2.5% as its accession rate of 5.7% exceeded its separation rate of 3.2%. Among sub-sectors, construction saw the highest turnover rate at four percent (from 5.7% in the third quarter), followed by manufacturing at 2.1% (from -1.8%); and water supply; sewerage waste management and remediation activities (1.1% from 2.4%).

On the other hand, agriculture saw a negative job creation rate at 2.8%, worse than the net loss of 2.6% in the third quarter.

Turnover “might have increased” this year due to the impact the coronavirus pandemic is having on jobs, particularly on retrenchment and voluntary separation, Asian Institute of Management Economist and Adjunct Faculty John Paolo R. Rivera said.

“The strong economy in 2019 might have also motivated workers to move to greener pastures only to be delayed by the pandemic,” he said in an email.

“[The] [g]overnment is already doing pump-priming to generate employment to those displaced by the pandemic. Passing the bills related to stimulus packages to enterprises and certifying them as urgent may also help in improving labor conditions assuming the benefits to laborers will be emphasized,” Mr. Rivera added.

The third- and fourth-quarter labor turnover surveys conducted by the PSA involved 1,209 establishments in Metro Manila. These sample establishments, each of which had at least 20 workers, were drawn from the 2018 List of Establishments as of Jan. 8, 2019.