2003 Annual Survey of Philippine Business and Industry (ASPBI) - Construction Sector : Preliminary Results

Reference Number: 264
Release Date: 26 April 2007

General Engineering Construction Industry Dominates the Sector

·  According to the preliminary results of the 2005 Annual Survey of Philippine Business and Industry (ASPBI), the total number of construction establishments in business operation was 2,480. Of the total, 72.6 percent had an average employment of less than 20 and the remaining 27.4 percent had an average employment of 20 and more.
·  General engineering construction was the biggest in terms of the number of establishments as this comprised more than half (53.8%) of the total establishments. Figure 1 shows the number of establishments by industry group and sub-class for the construction sector.

General Engineering Construction Industry Provides the Biggest Employment

·  Total employment generated by establishments in the construction sector in 2005 was estimated at 109,966.
·  Among industries, general engineering construction employed the highest number of workers reaching 68,678 or 62.4 percent of total employment. On the other hand, establishments engaged in site preparation, renting of construction or demolition equipment with operator, hired only 455 workers or 0.4 percent. Figure 2 displays the distribution of employment by industry group and sub-class for the construction sector.

Average Annual Compensation is P125.4 Thousand Per Construction Worker

·  Total compensation paid by all construction establishments during the year amounted to P13.5 billion, translating to an average annual compensation of P125,435 per paid construction worker.
·  Among industries, establishments engaged in building completion paid the highest average annual compensation amounting to P141,389 while those engaged in site preparation, renting of construction or demolition equipment with operator paid the lowest at P82,878. Figure 3 compares the average annual compensation by industry group and sub-class for the construction sector.


·  Total revenue earned by all construction establishments during the year 2005 was estimated at P103.0 billion, of which about 70.0 percent was accounted for by general engineering construction industry.
·  In 2005, total cost incurred by the construction sector, excluding compensation, amounted to P80.1 billion.

General Engineering Construction Generates P71.2 Billion in Value of Output

·  Value of output generated in 2005 by all construction establishments reached P101.0 billion.
·  By industry, general engineering construction contributed the biggest share in the value of output as it grossed P71.2 billion (70.5%). Non-residential building construction ranked a far second with P14.5 billion (14.3%). Figure 4 presents the distribution of value of output by industry group.

Non-Residential Building Construction Records the Highest Productivity

·  Labor productivity for the construction sector, measured as the ratio of value added to total employment, was P284,321 per construction worker.
·  Non-residential building construction registered the highest labor productivity at P349,377 while establishment engaged in site preparation, renting of construction or demolition equipment with operator recorded the lowest at P119,147. Figure 5 illustrates labor productivity by industry group and sub-class for the construction sector.



The 2005 Annual Survey of Philippine Business and Industry (ASPBI) is a continuing activity of the National Statistics Office aimed at collecting information on the structure and levels of economic activities in the country. It is the 38th in the series of annual surveys of establishments conducted by the Office and the 24th in the series for the construction sector.

The survey is undertaken by authority of five (5) legislative acts and presidential directives, namely: Commonwealth Act No.591, Presidential Decree No. 418, Executive Order No. 121, Executive Order No. 352 and Executive Order No. 5.

The reference year of the survey is 2005.

Scope and Coverage

The unit of enumeration of the survey is the establishment. It is defined as an economic unit under a single ownership or control, engaged in one or predominantly one kind of economic activity at a single fixed location. Establishments are classified according to economic sectors, which are the scope of the survey. Fourteen sectors of the Philippine economy are covered in the 2005 ASPBI.

One of these sectors is the construction. The sector is comprised of five (5) industry groups as well as sub-class, namely:

  1. site preparation
  2. residential building construction
  3. non-residential building construction
  4. general engineering construction
  5. building installation
  6. building completion
  7. renting of construction or demolition equipment with operator

Sampling Design

Stratified systematic sampling was utilized to select samples for the 2005 ASPBI. The updated 2004 List of Establishments (LE) was the frame used to draw the sample of establishments.

Employment size, defined as the average total employment (ATE) of an establishment, served as the stratification variable. The domains were region and industry for the group of establishments with ATE of 20 and more. For establishments with ATE of less than 20, the whole country and industry served as the domains.

The amended 1994 Philippine Standard Industrial Classification (PSIC) was used to classify establishments according to economic activity from which they derive their major income or revenue. On the other hand, geographic locations are classified according to the Philippine Standard Geographic Classification (PSGC).

Response Rate

Questionnaires were distributed to sample establishments starting in April 3 to April 28, 2006. The respondents were generally given 30 days within which to accomplish the questionnaires. Collection of accomplished questionnaires was programmed from May 2, 2006 until August 31, 2006. Manual and machine processing, and tabulation of data were undertaken in the Central Office.

The effective response rate is 63.8 percent for the construction sector. For establishments with ATE of 20 and more workers, the effective response rate is 70.1 percent while that for establishments with ATE of less than 20 workers is 48.4 percent.

Reports of the non-responding establishments were imputed based on the imputation methods and available data sources.

Concepts and Definition of Terms

Establishments - an economic unit under single ownership or control, i.e., under a single legal entity engaged in one or predominantly one kind of economic activity at a single fixed location, and having permanency of assets in its premises during the operation. 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, 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.

Construction Establishments - Firm or company engaged in building of new construction, addition, alteration and repair, and demolition.

Economic activity or Business - is the activity of the establishment as classified under the amended 1994 Philippine Standard Industrial Classification (PSIC). Generally, the main activity of the establishment is the establishments' principal source of income. If the establishment is engaged in several activities, its main activity is that which earns the biggest income or revenue.

Average total employment (ATE) - is the sum of the number of persons who worked in or for the establishment for all months of the year divided by 12, regardless of the number of months the establishment is in operation.

Total Employment - Employment includes all persons who worked in or for the establishment as of the period November 15, 2005.

Paid employees - include all persons working in the establishment and receiving pay, as well as those working away from the establishment paid by and under the control of the establishment. Included are all employees on sick leave, paid vacation or holiday. Excluded are consultants, home workers, workers receiving pure commissions only and workers on indefinite leave.

Unpaid workers - include working owners who do not receive regular pay, apprentices and learners without regular pay and persons working for at least one-third of the working time normal to establishment and do not receive regular pay.

Salaries and wages - are payments in cash and in kind to all employees, prior to deductions of employee's contribution to SSS/GSIS, withholding tax, etc. Included are total basic pay, overtime and other benefits.

Employer's Contribution to SSS/GSIS and the like - refers to payments made by the establishment for social security in behalf of the employees. Examples are SSS, GSIS, PhilHealth and PAGIBIG.

Revenue - refers to cash received and receivables for goods sold and services rendered. Valuation is in producer's price (ex-establishment), net of discounts and allowances, including duties and taxes, and excluding subsidies.

Cost - refers to all expenses incurred during the year whether paid or payable. Valuation is at market price including taxes and other charges, net of rebates, returns and allowances. Included are goods and services received by the establishment from other establishments of the same enterprise and valued as though purchased.

Subsidies - are special grants in the form of financial assistance or tax exemption or tax privilege given by the government to aid and develop an industry or production process and to protect it against competition. Included are tax credit, tax and duty exemptions, price support and price discount, and interest rate subsidy.

Fixed assets - are physical assets expected to have a productive lives of more than one year and intended for use and/or being used by the establishment. Included are land, buildings, other structures and land improvements, transport equipment, computers and peripherals, telecommunications equipment and apparatus, other machinery and equipment including furniture and fixtures, and cultivated assets.

Value of Output - is a derived measure of output that represents the total value of products sold, receipts from contract work and industrial services done for others, receipts from goods sold in the same condition as purchased, fixed assets produced on own account and change in inventory of finished goods, work-in-progress and goods for resale.

Gross Additions to Fixed Assets - is equal to capital expenditures less sale of fixed assets, including land.

Inventories - refer to the stock of goods owned by and under the control of the establishment as of fixed date, regardless of where the stocks are located. Valuation is at current replacement cost in purchaser's prices. Replacement cost is the cost of an item in terms of its present price rather than its original cost.

Finished Products Inventory - refers to the goods made by the establishment which are ready for sale/shipment as of reference date. Valuation is at producer's price.

Work-In- Progress Inventory - refers to the value of all goods which have been partially processed by the establishment but which are not usually sold or turned over to other establishment without further processing. Valuation is at producer's price.

Change in Inventories - is the total value of ending inventory less the total beginning inventory.

Census Value Added - represents the difference between the value of output and the total costs of materials and supplies consumed, fuels purchased, industrial services done by others and goods purchased for resale.

Value added - represents the sum of census value added and value of non-industrial services done for others less the cost of non-industrial services done for others and other costs.

Detailed Statistical Tables
Detailed tables at the national and regional levels are available upon request from the Industry Statistics Division, National Statistics Office, 4th Floor, Solicarel Bldg II, Ramon Magsaysay Blvd, Sta Mesa, Manila Tel No. (062) 716-39-32.

Source:   National Statistics Office
                 Manila, Philippines

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