Running Uphill: Growth, Jobs and the Quest for Productivity in the Philippines

Development Challenge

Despite progress, the Philippines' growth has lagged its peers. Between 2010 and 2024, average GDP growth has been 5.3 percent, compared to Korea and Malaysia's 7-10 percent at similar stages. Most of the new jobs are in low-productivity, low-pay services, and regional gaps persist, including low female labor participation. Top firms fail to grow and innovate, threatening the country's goal of a high-income, poverty-free status by 2040.

WBG Approach

The Philippines Growth and Jobs Report (GJR), developed through extensive consultations with government, academia, and the private sector, presents a reform agenda to create more quality jobs by expanding opportunities and strengthening capabilities. Building opportunities for growth and jobs requires investment, innovation, stronger local government revenue mobilization, streamlined business regulations, deeper capital markets, and modernized procurement. To build capabilities, the Report highlights addressing skills mismatches, investing in early childhood development and foundational education, and increasing women's labor force participation.

These priorities shape the first Growth and Jobs Development Policy Loan (GJ DPL), which supports reforms in property valuation, procurement, capital markets, digital business registration, and new education and training laws. A One WBG approach complements policy reform with IFC support for SME finance and capital market development. Partnerships with MDBs, in particular ADB, reinforce reform momentum.

As the report of its class, it will contribute to the implementation of other Growth and Jobs Reports globally and as such inform jobs agendas in many countries.

Results

The "Growth and Jobs Report" (GJR) is a flagship World Bank Group (WBG) publication designed to help developing countries accelerate growth and job creation. The first report of its kind, released in July 2025 for the Philippines, is already shaping national policy debate, policy actions, and guiding WBG engagement, including lending decisions.

The report identifies key barriers to growth and employment and sets out a reform agenda to shift the country's development trajectory. It presents 47 targeted recommendations that could boost average annual growth by 1.4 percentage points and create 5.1 million better-paying jobs by 2040.

This evidence-based analysis is now central to policy discussions among government, academia, and the private sector. It directly informed the WBG's new Country Partnership Framework and continues to provide key inputs for policy decisions of the Government of the Philippines. In particular, the analysis has shaped the Philippines Growth and Jobs Development Policy Loan (DPL) through which the Bank supports reforms in taxation, procurement, business regulation, capital markets, and human capital development, as well as the design of policy interventions to support firms' internationalization plans by the Department of Trade and Industry.

Beneficiary Quote

"The Growth and Jobs Report gave us a clear map of what holds back faster growth and job creation. It sharpened our focus on investment, skills, and fiscal reforms." - Secretary Arsenio Balisacan, Department of Economic Planning and Development, the Philippines.

Contribution to WBG Targets and Jobs

Implementing the GJR reform package could boost annual GDP growth by 1.4 percentage points from 2025-40, create 5.1 million better-paid jobs, and increase real wages by nearly 13 percent. The GJR analysis shapes the Philippines' new Country Partnership Framework (2025-31), which aims for 4 million additional quality jobs, guides the Growth and Jobs DPL series, and the design of firms' internationalization support interventions by the Department of Trade and Industry. It anchors WBG support to reforms that promote inclusive growth and expand opportunities.

Lessons Learned

Addressing the jobs challenge requires a whole-of-society effort, not just government action. The GJR creates a shared narrative linking jobs and growth, aligning across government, the private sector, and other stakeholders. Connecting this narrative to national development goals increases ownership and relevance.

Evidence and engagement drive impact. The GJR shows that rigorous analytics-combined with broad consultations-especially with the private sector-lead to credible, actionable recommendations. Quantified impact estimates help governments prioritize reforms, while peer country comparisons create urgency.

A standardized but country-tailored framework adds global value as shown by the Philippines' example transforming national policy agendas and guide WBG lending. This approach strengthens the country's jobs strategy while laying the groundwork for replication in other contexts.

The Growth and Jobs framework will guide WBG engagement in the Philippines through the new Country Partnership Framework (2025-31) as well as the reform priorities of the Government.

This is reflected in the policy reforms supported by the GJ DPL series (Table in Annex below) addressing key challenges identified by the report, with substantial estimated effects on job creation and growth. These reforms focus on improving fiscal management both at local and national levels, on boosting private sector investment and job creation, and on improving human capital. They will help improve revenue generation capacity and quality of expenditure, deepen capital markets, streamline regulations to facilitate business entry, expand enterprise-based training, close learning gaps, and early years human capital development.

Next Steps

The GJR is also informing the Philippines Department of Trade and Industry's strategy on firms' internationalization, through smart support to potential exporters and suppliers to multinationals.

The GJR will continue to inform public debate, provide benchmarks to track progress, and shape policy dialogue and WBG engagement to help increase the quantity and quality of jobs.

Globally, lessons from this experience are shaping GJRs in other countries.