Sub-9% growth may plunge Filipinos into wage, job crisis—Guinigundo

Diwa Guinigundo

If the Philippine economy fails to expand at least nine percent over the next three years, Filipinos will grapple with lower wages, joblessness, and worsening poverty, according to an economic expert.

“Unless the economy is able to sustain a growth rate of more than nine percent from 2022 through 2028, the economy stands to suffer from a large GDP [gross domestic product] deficit relative to the forecast based on the original growth path,” GlobalSource Partners Philippines country analyst Diwa Guinigundo said in a March 14 report titled “Reflections on economic growth: dynamics and risks.” 

“This means there would be fewer jobs, lower real wages, worsening poverty and income inequality,” Guinigundo explained. 

Guinigundo was referring to the pre-pandemic growth path as the original growth trajectory, noting the country’s massive economic decline at the onset of the Covid-19 pandemic. 

To recall, the local economy shrank by 9.5 percent in 2020, “throwing off the country to traverse a lower growth path.” It rebounded in 2021 with a full-year growth rate of 5.6 percent. This further accelerated to 7.6 percent in 2022 and settled to 5.6 percent in 2023. Growth remained flat last year when it stayed at 5.6 percent. 

Notably, the country’s economy peaked in 2022 but fell short of the nine-percent benchmark to recover from the losses caused by the pandemic. The country’s GDP growths in 2023 and 2024 were also underwhelming, not to mention being way below nine percent. 

Guinigundo said that for the first half of 2025, GlobalSource Partners Philippines’ assessments show that “GDP growth may be expected to increase within a narrow band over the next two quarters—accelerating slightly faster at 5.7 percent in the first quarter, and about 5.9 percent in the second quarter. 

These are also below the International Monetary Fund (IMF) and World Bank’s projected annual growth of six to 6.3 percent. 

Guinigundo said last year’s GDP performance and agriculture and service sector development would be the major growth drivers. 

“This means that, despite the announced policy initiatives in these areas, no significant gains have been achieved insofar as the existing infrastructure and institutions are concerned; current economic efficiency and productivity levels could just be steady,” Guinigundo said. 

Earlier this year, President Marcos’ economic managers widened their growth projection for the Philippines to six to eight percent for 2025 until 2028, citing both domestic and global uncertainties.