CHAPTER III

EMPLOYMENT AND PRODUCTIVITY

EMPLOYMENT vs. UNEMPLOYMENT
LABOR

It is one of the important factors in the countrys development. It

pertains to the use of an individuals capability, intellect and strength
in order to produce goods and services.
It is under the SECTOR OF PRODUCTION.

LABOR FORCE

is the segment of the population which is capable of delivering goods

and services.
It is the number of individuals within the given geographical area, and
within an age bracket who are either employed or unemployed but are
physically and mentally capable of working.

EMPLOYMENT

It is an economic state wherein people who want to work, find

employment to their education, experience and ability.
TYPES OF EMPLOYMENT

1.
2.
3.
4.
5.

Employed or Self-employed
Part-time Employees
Fixed-term Employees
Casual Employees
Children and Young People

UNEMPLOYMENT

It is when the workers skill is not fully utilized in a job of he is paid

lower than what his skills should earn.

3 TYPES OF UNEMPLOYMENT

1. FRICTIONAL UNEMPLOYMENT is an unemployment that comes

from people moving between jobs, careers, and locations.

Causes:
Workers changing jobs
Seasonality
Transition period of students who graduated and are taking their time
choosing their jobs.

2. STRUCTURAL UNEMPLOYMENT is an unemployment that comes

from there being an absence of demand for the workers that are
available.
Causes:
Caused by the major developments and changes in consumer
demands in technology.
Changes in Technology
Changes in Taste
3. CYCLICAL UNEMPLOYMENT occurs when the unemployment rate
moves in the opposite direction as the GDP growth rate. So when GDP
growth is small (or negative) unemployment is high.
Causes:
Caused by the upswings and downturns of the business cycle.

EMPLOYMENT & UNEMPLOYMENT RATE IN JULY 2014

(Results from the July 2014 Labor Force Survey LFS)

PHILIPPINES
Population 15
years and over
(in 000)
Labor Force
Participation (%)
Employment Rate
(%)
Unemployment

JULY 2014
(Excludes
Leyte)

JULY 2013
(Excludes
Leyte)

JULY 2013
(Includes
Leyte)

64, 070

63, 180

64, 470

64.4

63.9

63.9

93.3

92.7

92.7

6.7

7.3

7.3

Rate (%)
Underemploymen
18.3
19.2
19.2
t Rate (%)
EMPLOYMENT & UNEMPLOYMENT RATE IN JANUARY 2015
(Results from the January 2015 Labor Force Survey LFS)

PHILIPPINES

January 2015
(Excludes
Region VII)

January 2014
(Excludes
Region VII)

January 2015
(Excludes
Leyte)

62, 870

61, 777

64, 591

63.8

63.8

63.7

93.4

92.5

93.4

6.6

7.5

6.6

17.5

19.5

17.9

Population 15
years and over
(in 000)
Labor Force
Participation (%)
Employment Rate
(%)
Unemployment
Rate (%)
Underemploymen
t Rate (%)
LABOR PRODUCTIVITY

It gives us some indication of how efficiently each labor hour

combines with the capital and existing state of technology in
producing an output.

FORMULA:
Specific Productivity Labor = Total out/Total man hours

FACTORS OF PRODUCTIVITY
1.
2.
3.
4.

Skills Training
Motivation of Workers
Information Communication Technology
Inflation

SKILLS TRAINING It helps employees be updated on the newest

technology and methods to produce more. It helps the human capital and as
a result the production of labor would increase.

MOTIVATION OF WORKERS It provides a reason for the workers to

produce more.
INFORMATION COMMUNICATION TECHNOLOGY It helps the company in
handling the investment and for the company to branch out and produce
more.
INFLATION it affects the production negatively because there will be an
increase of employment that would mean less people would help produce;
also, there would be less investments.
WAYS OF INCREASING THE LABOR PRODUCTION
1. Overtime work
2. Produce the Quality of workers
3. Upgrading Technology
SOURCES OF PRODUCTION
There are 3 sources of production, as provided by the Villegas and Abola in
their book Economics: An Introduction and by McConnell and Brue.
1. Advances in Knowledge
Education is about adopting the new technology and also
learning new and faster method of producing.
Technology is about finding new way to organizing the whole
production and systems to increase production.
2. Economies of Scale is about organizing production. It also about
what industry our country should focus on for the economy to benefit.
3. Improved Resource Allocation It pertains to promotion through
deregulation where in the market should free itself from the Regulation
of the government because of the tariffs and quotas are the barriers
for international trade that would helps less in economic growth.