ELECTRONICS INDUSTRY: 2008
The electronics industry has been considered as the driver of growth for the manufacturing sector in recent years as its share to the total value of output was recorded as high as 28.0 percent in 2001 and 20.0 percent in 2008. In terms of employment, the industry share to total manufacturing was 20.9 percent in 2008.
Majority of the electronic manufacturing establishments are into semi-conductor and other electronic components
In the 2008 Annual Survey on Philippine Business Industry (ASPBI), the electronic manufacturing establishments with average total employment (ATE) of 20 and over had a total of 203 establishments representing 4.4 percent of the total for the entire manufacturing sector.
Semi-conductor devices and other electronic components dominate the industry with 129 establishments (63.5 percent) of the total establishments in the electronics industry. Computer, computer peripheral equipment and accessories ranked a far second with 43 establishments (21.2 percent). Television and radio transmitters, receivers, sound or video recording or reproducing apparatus and associated goods consisted of 20 establishments (9.9 percent). Apparatus for line telephony and line telegraphy with 8 establishments (3.9 percent). Office and accounting machinery had the least with 3 establishments (1.5 percent). Figure 1 shows the distribution of the total number of electronic manufacturing establishments.
Most of the establishments are private corporations
As to legal organization, of the total establishments, a very significant 98.5 percent were private corporations while only 1.5 percent were single proprietorships.
With regards to economic organization, 91.6 percent (186) were operating as single establishments, 6.9 percent (14) as branches and the remaining 1.5 percent (3) as establishment and main office.
More than half of the total number of establishments, 123 (60.6 percent) were classified as large (200 employees and over); 34 (16.7 percent) were medium establishments (100-199 employees); and 46 (22.7 percent) were small establishments (20-99 employees).
Semi-conductor devices and other electronic components register as the top employer of the industry
In 2008, the electronic industry generated a total employment of 180,415 (20.9 percent) of the total employment for all manufacturing sector.
Semi-conductor devices and other electronic components employed a total of 127,172 workers (70.5 percent of total employment). Computers, computer peripheral equipment and accessories hired 44,302 employees (24.6 percent), ranked second. Television and radio transmitters, receivers, sound or video recording or reproducing apparatus, and associated goods had 6,023 workers (3.3 percent). Apparatus for line telephony and line telegraphy with 1,947 workers (1.1 percent). Office and accounting machinery employed 971 employees (0.5 percent).
Among the industry classes included in the electronics industry, other office, accounting and computing machinery sector recorded the largest average employment per establishment at 1,030 followed by semi-conductor devices and other electronics components with 986. Apparatus for line telephony and line telegraphy sector, however, ranked last as to average employment per establishment at 243.
Electronics industry is one of the highest employment-generating ventures
From 1999 to 2006, total employment for the whole electronics industry depicted an increasing trend. Its labor population had grown from 161,123 in 1999 to 219, 312 in 2006. This is a remarkable achievement for the industry since the total employment grew by 36 percent more in just seven years. On the other hand, the decrease in 2008 could be attributed to the worsening global economic crisis. Figure 2 shows the trend of the total employment of electronic manufacturing establishments.
Semi-conductor devices and other electronic components provide the highest monthly pay
- Total compensation for the electronics industry was recorded at PhP38.3 billion representing 22.2 percent of total compensation paid to workers in the entire manufacturing sector (PhP172.3 billion).
Semiconductor devices and other electronic components had the biggest contribution to total compensation for the electronics industry with almost PhP28.3 billion (73.7 percent). This was followed by computers, computer peripheral equipment and accessories and office accounting and computing machinery classes combined with PhP8.4 billion. TV and radio receivers, sound or video recording or reproducing apparatus and associated goods ranked third as the largest contributor to the electronics industry with around PhP1.0 billion.
Average monthly compensation paid by electronic manufacturing establishments industry ranged from PhP14, 376 to PhP18,526 with semi-conductor devices and other electronic components industry paying the highest and 11.0 percent more of the average compensation for the entire manufacturing sector (PhP16,694). Figure 3 shows the average monthly compensation for the electronic manufacturing establishments.
Semi-conductor devices and other electronic components is the biggest contributor to value of output
Value of output for the electronics industry was estimated at PhP618.7 billion in 2008. This represents 20.0 percent of the total value of output for the entire manufacturing sector.
Semi-conductor devices and other electronic components accounted for the largest share of 70.5 percent (PhP436.4 billion). Computers, computer peripheral equipment and accessories and other office computing machinery, PhP155.4 billion. Television and radio transmitters, receivers, sound or video recording or reproducing apparatus, and associated goods, PhP15.5 billion. Apparatus for line telephony and line telegraphy, PhP6.8 billion. Office and accounting machinery, PhP4.6 billion. Figure 4 shows the value of output for the electronic manufacturing establishments.
Semi-conductor devices and other electronic components is the sole leader in revenue earned and cost incurred
Total revenue generated by the electronics industry was PhP632.6 billion with semi-conductor and other electronic components contributing 70.3 percent (PhP445.2 billion). Computers, computer peripheral equipment and accessories combined with other office, accounting and computing machinery ranked second with PhP160.2 billion (25 percent). Office and accounting machinery had the least revenue with PhP4.7 billion (0.7 percent).
Semiconductor devices and other electronic components incurred the biggest cost among all the industry classes. It amounted to PhP385.4 billion representing 72 percent of the total for the electronics industry and 15 percent for the entire manufacture sector. Office and accounting machinery had the least cost with almost PhP4 billion (0.7 percent for the electronics industry).
Computer, computer peripheral equipment and accessories and other office, accounting and computing machinery n.e.c are the most profitable among the industry classes
The highest profit margin obtained was that of computer, computer peripheral equipment and accessories combined with other office, accounting and computing machinery n.e.c at around 14.2 percent, followed by office and accounting machinery at around 11.6 percent. Television and radio transmitters, receivers, sound or video recording or reproducing apparatus and associated goods had the lowest profit margin with 3.9 percent.
Bulk of the electronic manufacturing establishments operates with rated capacity of 60 to 79 percent
More than one-third (80 establishments or 39.4 percent) of the electronic manufacturing establishments operated with rated capacity of 60 to 79 percent, 59 establishments (29.1 percent) operated with rated capacity of 80 to 89 percent, 33 establishments (16.3 percent) operated at full capacity. Refer to Table 4.
The 2008 ASPBI is one of the designated statistical activities of the National Statistics Office with the objective of collecting and generating information on the structure and trends of economic activities for the year 2008 in the formal sector of the economy.
It is the 39th in the series of annual surveys of establishments for the manufacturing sector since the 1956 Survey of Manufactures.
This report presents the preliminary results of the 2008 Annual Survey of Philippine Business and Industry (ASPBI) with the electronics industry whose TE is 20 and over as the subject of discussion. The electronics industry consists of 11 industry strata among the 441 covered under the manufacturing sector of the 2008 ASPBI.
Establishments engaged in the manufacture of consumer electronics, semiconductor devices and all other electronic components are referred to as the 'electronics industry'. It is comprised of seven sub-categories. The categories are classified according to the products they manufacture. The coverage of the electronics industry is shown in the table below.
The conduct of the 2008 ASPBI was undertaken by authority of the following legislative acts and presidential directives
Commonwealth Act No. 591 (An Act to Create a Bureau of the Census and Statistics, to Consolidate Statistical Activities of the Government Therein).
Presidential Decree No. 418 dated March 20, 1974 reconstituted the Bureau of the Census and Statistics as a new agency to be known as the National Census and Statistics Office (NCSO), under the administrative supervision of the National Economic Authority (NEDA) .
Executive Order No. 121 (Reorganization Act of the Philippine Statistical System) dated August 4, 1987 renamed the National Census and Statistics Office (NCSO) to National Statistics Office (NSO) which shall be the major statistical agency responsible for generating general purpose statistics and undertaking such censuses and surveys.
Executive Order 352 (Designation of Statistical Activities) that will generate critical data for decision-making by the Government and the Private Sector, dated July 1, 1996.
Executive Order 5 (Strengthening the National Statistics Office), dated July 29, 1998.
Unit of Enumeration
The unit of enumeration is the establishment. It is defined as an economic unit under a single ownership control, i.e., under a single legal entity in one or predominantly one kind of economic activity at a single fixed location
In operational terms, it is also defined as the unit that is engaged in the production of the most homogenous group of goods and services, usually at one location, but sometimes over a wider area, for which separate records are available that can provide data concerning the production of these goods and services and the materials, labor and physical resources used in the production. This is referred to as the kind-of-activity unit. The kind-of-activity unit differs from the establishment in that there is no restriction with respect to the geographic area in which a given kind of activity is carried on by a single legal entity.
Classification of Establishments
An establishment is categorized by its economic organization (EO), legal organization (LO), industrial classification, employment size, and geographic location
Economic Organization. (EO) This relates to the organizational structure or role of the establishment in the organization. The following are the types of EO:
- Single establishments (EO=1) is an establishment which has neither branch nor main officeBranch only (EO=2) is an establishment which has a separate main office located elsewhere
- Establishment and main office (EO=3), both located in the same address and with branch/es elsewhere
- Main office only (EO=4) is the unit which controls, supervises and directs one or more establishments of an enterprise
- Ancillary unit other than Main Office (EO=5) is the unit that operates primarily or exclusively for a related establishment or group of related establishments or its parent establishment and provides goods or services that support but do not become part of the output of those establishments.
Legal Organization. (LO) This provides the legal basis for ownership of the establishment. The following are the types of LO:
- Single Proprietorship (LO=1) is a business establishment organized, owned and managed by one person, who alone assumes the risk of the business enterprise
- Partnership (LO=2) is an association of two or more individuals for the conduct of a business enterprise based upon an agreement or contract between or among them to contribute money, property or industry into a common fund with the intention of dividing profits among themselves
- Government Corporations (LO=3) is a private corporation organized for private aim, benefit or purpose and owned and controlled by the government
- Private Corporation (LO=4) is a corporation organized by private persons
- Cooperative (LO=5) is an organization composed primarily of small producers and/or consumers who voluntarily join together to form business which themselves own, control and patronize
- Others (LO=6) is an organization not classified in any of the above classification. It includes private associations, foundations, NGOs or other forms of legal organization.
Industrial Classification. The industrial classification of an economic unit is determined by the activity from which it derives the major income or revenue. The amended 1994 Philippine Standard Industrial Classification (PSIC) is utilized to classify economic units according to their economic activities. It is aligned with the International Standard Industrial Classification (ISIC) Revision 3.1 of all economic activities.
Establishment Size. The size of an establishment is determined by its Total Employment (ATE). The following are the employment size classification used in the establishment survey:
|TE Code||Total Employment (TE)|
|9||2,000 and over|
Geographic Classification Establishments are also classified by geographic area using the Philippine Standard Geographic Code (PSGC). The PSGC contains the latest updates on the official number of regions, provinces, cities, municipalities and barangays in the Philippines. It consists of 17 administrative regions as approved under Executive Order No. 36 dated 19 September 2001 (Providing for the Reorganization of the Administrative Regions in MindanaoÃƒÂ¯Ã‚Â¿Ã‚Â½.) and Executive Order No. 103 dated 17 May 2002 (Dividing Region IV into Region IV-A and region IV-B, transferring the province of Aurora to Region III).
The geographic codes used in the 2008 ASPBI are in accordance with PSGC as of September 2008.
Frame of Establishments. The frame for the 2008 ASPBI was extracted from the 2008 List of Establishments (LE). This was used to draw the same establishments for the survey.
The 2008 LE is the combined result of the following:
1. 2004 Updating of the List of Establishments (ULE) conducted in the National Capital Region and in selected urban barangays in cities/provincial capitals/first class municipalities (2004 ULE areas) during the period from September 2004 to May 2005.
2. 2005 ULE in rural barangays in provincial capitals/cities/municipalities of selected provinces (2005 ULE areas) conducted from September to December 2005. The selected provinces are in Regions 3 and 4, in provinces where NSO Regional Office is located, and in provinces with the highest count of establishments in rural barangays of the provincial capitals/cities/municipalities. It also covered growth areas in selected provinces.
3. 2008 LE conducted in September 2008 in priority areas (growth centers and other areas where significant changes in number of establishments were observed) and field verification of status and characteristics of establishments listed in selected sources but not found in the LE or referred to as "no matched" establishments.
4. Survey feedbacks from the 2006 CPBI (Census of Philippine Business and Industry), 2008 MISSI (Monthly Integrated Survey of Selected Industries), the 2008 QSPBI (Quarterly Survey of Philippine Business and Industry), the 2008 SIFE (Survey on Impact of Floods on Establishments), the 2007 SSIC (Special Survey of Imported Commodities) and 2008 SPLN (Survey on Production and Logistics Networks of Philippine Manufacturing Industries) were also used to update and validate the 2008 LE.
Scope and Coverage
The 2008 ASPBI is a nationwide undertaking confined to the formal sector of the economy and a such excludes the "informal" sector. The following comprise the formal sector:
1. Corporations and partnerships.
2. Cooperatives and foundations.
3. Single proprietorship with employment of 10 or more.
4. Single proprietorship with branches.
The rationale of covering only the formal sector for the survey is based on the contribution of this group to the value added of the major sectors. The 2005 ASPBI results show that the contribution of the formal sector was at least 50 percent of value added. In 11 of the 14 sectors, value added of the formal sector ranged from 80 to 100 percent of the total. Another consideration was the quality of the ASPBI frame. The ASPBI frame is extracted from the List of Establishments (LE). The series of updating operations since 1999 focused more on the updating of the formal sector. Budgetary constraint was the reason why coverage was limited to these economic units.
The 2008 ASPBI covers only the following economic units:
1. All establishments with Total Employment (TE) of 10 or more, and
2. All establishments with TE of less than 10, except those establishments with Legal Organization (LO=1, Single Proprietorship) and Economic Organization (EO=1, single establishment) that are engaged in economic activities, classified according to the amended 1994 Philippine Standard Industrial Classification.
The economic activity within the scope and coverage of the 2008 ASPBI are listed below.
Moreover, to improve response rates for Government-Owned-and-Controlled Corporations (GOCCs) LO=3, only those with EO= 1,3, and 4 were covered starting with the 2008 ASPBI
The 2008 ASPBI utilized stratified systematic sampling with five-digit PSIC serving as industry strata and employment size (TE) as the second stratification variable
Sampling Domain For TE of 20 and over, the domains, the domains are the region and industry, with employment size (TE) as the stratification variable. For TE of less than 20, the domains are the national and industry with employment size as the stratification variable
Geographic Domain For establishments with TE of 20 and over, the 17 adminitrative regions serve as the geographic domains. For establishments with TE of less than 20, the whole country serves as the geographic domain
Industry Domain For establishments with TE 20 and over, the 5-digit PSIC constitute the industry strata or industry domains. For TE less than 20, industry sub-sectors or groups of sub-sectors (4-digit/5-digit 1994 PSIC) constitute the industry strata. Bases of groupings were as follows: similarity of industries and number of establishments in the 5-digit and 4-digit PSIC classification
Employment Stratum For the 2008 ASPBI, the TE sizes were either combined or taken as a group to comprise the employment stratum and were limited to only five strata for all sectors. The basic consideration for grouping was the concentration of establishments in the TE sizes
Within the industry domains for each sector, the establishments are grouped according to the following employment stratum:
Employment Size - determined by the total number of employment as of reference date: November 15, 2008
Profit margin - a ratio of profitability calculated as net income divided by revenues, or net profits divided by sales. It is very useful when comparing establishments in similar industries. A higher profit margin indicates a more profitable establishment that has better control over its costs
Capacity Utilization - the ratio of total output to the maximum rated capacity
Rated capacity - refers to the largest volume of output possible at which the factory can operate with an acceptable degree of efficiency taking into consideration unavoidable losses of productive time (i.e., vacations, holidays and repairs to equipment) and availability of raw materials
(Sgd.) CARMELITA N. ERICTA
Source: National Statistics Office