The rise in unemployment to 2.96 million Filipinos in January 2026 has prompted Senator Francis “Chiz” Escudero to call for immediate measures to strengthen micro, small, and medium enterprises (MSMEs), which are widely considered the backbone of the Philippine economy and employ nearly two-thirds of the country’s workforce.
Citing the latest Labor Force Survey of the Philippine Statistics Authority, Escudero said the increase in unemployment reflects not only seasonal job losses but also deeper structural challenges that require urgent legislative action.
To help address the problem, the senator is urging the Senate to fast-track deliberations on two complementary bills he authored: Senate Bill No. 231, which seeks to simplify tax requirements and reduce compliance costs for MSMEs, and Senate Bill No. 233, which aims to restore mandatory credit allocation for small businesses by requiring banks and lending institutions to set aside a portion of their loan portfolios for MSME lending.
Escudero noted that both measures have been pending in their respective Senate committees since August last year.
“Access to financing is the lifeblood of small businesses. Without credit, MSMEs cannot replenish their inventory, modernize operations, or expand their workforce. At the same time, high compliance costs make it harder for them to survive and recover,” he said.
The Bicolano lawmaker explained that the two proposed measures are designed to work together as part of a broader MSME recovery strategy—one focused on easing operational burdens, and the other on ensuring that capital reaches businesses that need it most.
“If we want to reverse the rising unemployment rate, we must strengthen the enterprises that employ the majority of our people. These reforms are practical, fiscally responsible, and directly address the roots of the problem,” Escudero added.
He emphasized that supporting MSMEs remains one of the most cost-effective ways to create jobs without requiring significant additional government spending, warning that delays in legislative action could lead to further business closures and job losses.
“Every month of delay means more small businesses shutting down and more Filipinos losing their livelihoods. If we want families to have stable and dignified work, we must empower the backbone of our economy,” he said.
According to the latest report of the Philippine Statistics Authority, the unemployment rate climbed to 5.8% in January 2026, up from 4.4% in December 2025 and 4.3% in January 2025, meaning about 58 out of every 1,000 workers were without jobs or livelihoods.
Total employment also declined to 47.94 million in January 2026, compared with 48.49 million in January 2025 and 49.43 million in December 2025.
The report noted that the largest year-on-year employment losses were recorded in agriculture and forestry (1.42 million jobs), wholesale and retail trade (729,000), and fishing and aquaculture (140,000)—sectors largely dominated by MSMEs.
“Our MSMEs are among the most vulnerable to economic shocks and are often the slowest to recover. Right now, they are struggling,” Escudero said.
