The Philippine labor market boomed to a new high as the rate of employment increased in October 2016, according to the National Economic and Development Authority (NEDA).

The Philippine Statistics Authority’s Labor Force Survey (LFS) for October 2016 showed that employment rate rose to 95.3 percent to reach 41.7 million Filipinos employed. This rate is highest among the results in all of the previous October rounds of the LFS since 2006.

“This means that the growth of our economy is becoming more inclusive as it engages more and more Filipinos to participate in the labor market,” said Socioeconomic Planning Secretary Ernesto M. Pernia.

The services sector remained the top employment contributor with a share of 54.9 percent or 22.9 million of the total employed. The industry sector, meanwhile, accounted for 17.2 percent or 7.2 million of the total employed in October 2016, driven largely by strong growth in manufacturing and construction.

Likewise, unemployment rate in the country dropped further to 4.7 percent, the lowest rate recorded in the past decade.

“With the decrease of unemployment in October 2016, our implied full-year unemployment rate will be 5.5 percent, exceeding the government target for 2016 of 6.5 to 6.7 percent,” he added.

Moreover, the unemployment rate among the youth continued to decline in October 2016 at 11.6 percent, also a record low for all October rounds of the LFS since 2006. Likewise, the share of inactive youth—those who are neither studying nor employed—has consistently been declining in the past four years and has dropped to 20.5 percent in October 2016.

“While this shows progress, it is important to note that the unemployment rate of the youth is still more than twice the national unemployment rate and thrice the unemployment rate of 25 to 54 age group. This shows that we need to equip our youth with the right skills and experience to be able to compete with seasoned workers,” said Pernia.

On the other hand, underemployment increased to 18.0 percent in October 2016, making the full-year 2016 underemployment rate of around 18.4 percent. Underemployment was prevalent among those working in private households and those employed in family business.

Meanwhile, the number of stable wage and salary employment grew to 25.3 million or 60.8 percent of total employed persons in October 2016. This is the highest for all October rounds since 2006. Private establishments employ nearly 80 percent of these workers, while the public sector employs just 13 percent.

“The increase in stable wage and salary employment reflects our economy’s strength and the result of the government’s clamp down on unlawful contractualization,” the Cabinet official said.

However, he reiterated that more than a third of those who are employed are still vulnerable, citing that a large portion of those employed, especially in the agriculture sector, are susceptible to external shocks and economic downturns.

“We must accelerate the improvement of local infrastructure and facilitate the linkaging of the sectors, primarily between the agriculture and industry sectors, to help raise the productivity of farmers and increase the value of their products,” Pernia added.

He added that the government must seek to strengthen linkages between academe, technical education institutions and industry to ensure quality and relevance of education and that students gain competencies that are essential to thrive in today’s changing world of work.

“We must go beyond cramming information into our youth and foster the development of soft skills to enable the country’s youth to make informed career decisions and develop life skills necessary to succeed in a competitive workplace,” said Pernia.