· Table 1 shows the preliminary summary statistics of the CPBI in the Financial Intermediation Sector for establishments with average total employment (ATE) of 20 and over in 2006.
Other Monetary Intermediation industry dominates the sector
· The Philippines had a total of 727 establishments with ATE of 20 and over engaged in Financial Intermediation. As shown in Figure 1, Other Monetary Intermediation garnered the highest or more than one-third (37.4%) of the total. Credit Granting ranked second with 19.0 percent and Non-bank financial intermediation, n.e.c., third with 16.8 percent. Pawnshop Operations, on the other hand, recorded the lowest number of establishments.
More than half are located in the National Capital Region (NCR)
· By region, more than half (53.8%) were located in the NCR. CALABARZON placed second with 7.3 percent, followed by Central Luzon with 6.3 percent. The Cordillera Administrative Region (CAR) had the least number of Financial Intermediation establishments with less than one percent.
Other Monetary Intermediation industry employs the biggest number of workers
· Employment in 2006 reached a total of 142,157. Almost all or 99.7 percent were paid employees while the remaining 0.3 percent were working owners and unpaid employees.
· Other Monetary Intermediation industry, having the highest number in terms of establishments, also employed the most number of workers with 103,300 (72.7%). Insurance & Pension Funding, except Compulsory Social Security industry ranked second with 14,645 employees (10.3%). The least number of employees were establishments engaged in Pawnshop Operations.
· Region-wise, NCR was the top employer among regions with 122,447 employees (86.1%). A far second was CALABARZON with 3,127 (2.2%). CAR registered the least with only 296 employees.
Other Monetary Intermediation industry pays the highest compensation
· The total compensation paid by Financial Intermediation establishments amounted to PhP66.4 billion, an equivalent of PhP468.3 million, average annual compensation. Out of the total, PhP64.1 billion (96.6%) comprised the gross salaries and wages while the remaining PhP2.3 billion (3.4%) went to the employers contribution to SSS/GSIS and the like.
· By industry group, Other Monetary Intermediation paid the highest compensation to its employees amounting to PhP51.3 billion or 77.3 percent of the total. Next is Insurance & Pension Funding, except Compulsory Social Security which paid PhP5.8 billion (8.8%).
· Table 2 shows that labor payments in the NCR amounted to PhP63.1 billion (95.0%) of compensation nationwide. CALABARZON, which expended around PhP513.7 million, came next. Region IV-B (MIMAROPA) was the least payer with only PhP38.4 million.
Non-Bank Financial Intermediation, n.e.c. industry employees earns the highest
· Non-Bank Financial Intermediation, n.e.c. industry employees were the highest earners in 2006 with an average annual compensation of PhP638,194. Employees of Other Monetary Intermediation followed next with PhP496,696. Pawnshop Operations employees received the lowest average annual remuneration of PhP139,795 (See Figure 2 Distribution of Average Annual Compensation by Industry Group).
· By region, NCR-based workers received the highest average annual compensation of PhP516, 069 while employees from Region XII (SOCCKSARGEN) received the least with only PhP141,737. (Pls. check. Table 2, no entry for ARMM and NCR).
Total revenue amounts to PhP644.1 billion; Other Monetary Intermediation industry produces the largest
· Gross revenue earned in 2006 by the Financial Intermediation sector reached PhP644.1 billion. Other Monetary Intermediation industry was the top contributor with revenue of PhP391.3 billion or 60.7 percent of the total. Earning the second place is the Insurance & Pension Funding, except Compulsory Social Security industry with PhP111.5 billion (17.3%). On the other hand, the Pawnshop Operations generated the least revenue with only PhP156.5 million (0.02%). (See Fig.3)
· By region, the NCR generated the highest revenue amounting to PhP619.8 billion. The least revenue emanated from MIMAROPA.
Total cost reaches PhP404.0 billion, Other Monetary Intermediation industry spends the highest
· Costs for operating the sector summed to PhP404.0 billion. Other Monetary Intermediation industry incurred the highest cost with PhP264.7 billion (65.5%) followed by Insurance & Pension Funding, except Compulsory Social Security industry with PhP75.7 billion. (See Fig.3)
· By region, the NCR spent the largest as it incurred PhP393.9 billion (97.5%) cost for operating the sector. Central Visayas followed with PhP2.3 billion. The least cost was spent by MIMAROPA with only PhP78.3 million.
Revenue-cost ratio amounts to PhP1.59, Non-Bank Financial Intermediation, n.e.c. industry records the highest returns
· Revenue-cost ratio, the revenue generated per peso cost, amounted to PhP1.59 for the sector. Among industries, Non-Bank Financial Intermediation, n.e.c. recorded the highest with PhP3.57 revenue per peso cost followed by Pawnshop Operations with PhP3.07.
Value added amounts to PhP310.9 billion
· Value added was estimated at PhP310.9 billion. About 90.0 percent of the total value added of the sector was contributed by the top three industries. Among industries, Other Monetary Intermediation industry had the highest value added amounting to PhP180.0 billion. (See Fig.4)
· On the regional level, NCR contributed the largest value added with PhP295.7 billion or 95.1 percent of the total. Central Luzon and CALABARZON had a total value added of less than one percent with PhP1.4 billion (0.5%) and PhP1.3 billion (0.4%), respectively.
Non-Bank Financial Intermediation, n.e.c. industry employees are the most productive
· Employees of Non-Bank Financial Intermediation, n.e.c. industry were the most productive in 2006 in terms of revenue per employee with a PhP12.4 million revenue per employee, 172.8 percent higher than the national average of PhP4.5 million. Pawnshop Operations industry on the other hand. recorded the least with only PhP580,000.
· Value added per total employment, another measure of labor productivity, was valued at PhP2.2 million. Among industries, Non-Bank Financial Intermediation, n.e.c. had the highest average of PhP9.3 million while Activities Auxilliary to Insurance and Pension Funding industry was estimated at PhP4.4 million.
Gross addition to fixed assets totals PhP8.2 billion
· Gross addition to fixed assets in 2006 totaled to PhP8.2 billion with Other Monetary Intermediation industry recording the highest additions of PhP6.2 billion (76.3%). Pawnshop Operations industry had the lowest with only PhP68,000.
Government grants PhP859.4 million in total subsidies
· Subsidies in 2006 reached PhP859.4 million with the government providing the highest to Other Monetary Intermediation industry amounting to PhP854.0 million (99.4%). Insurance and Pension Funding, except Compulsory Social Security industry received PhP5.3 million (0.6%). Credit Granting received the least with PhP145,000. Other industries were not provided with government subsidy.
An economic census is a comprehensive collection, compilation, evaluation, analysis and publication of data about the economic activities of the country. It is a source of information for establishing a benchmark level for the measurement and comparison of national, regional and provincial economic growth. Particularly, the economic census data will be used in constructing national and regional income accounts in the country, in determining and comparing regional economic structures, in formulating plans and policies of the government in the attainment of economic goals, in providing updates for the frame of establishments and in the conduct of market research and feasibility studies.
The 2006 Census of Philippine Business and Industry (CPBI) is one of the designated statistical activities undertaken by the National Statistics Office. The 2006 CPBI is the 14th in the series of economic censuses conducted in the Philippines. It is preceded by those for 2000, 1994, 1988, 1983, 1978, 1975, 1972, 1967, 1961, 1948, 1939, 1918 and 1903. The present name, Census of Philippine Business and Industry was first used in the 2000 round with 1999 as the reference period.
The conduct of the 2006 CPBI was governed by authority of the following legislative acts and presidential directives, namely:
* Commonwealth Act No. 591 (An Act to Create a Bureau of the Census and statistics, to Consolidate Statistical Activities of the Government Therein) approved on August 19, 1940. CA No. 591 empowers the Bureau, among other things, to prepare for and undertake all censuses of population, agriculture, industry and commerce. The same act also provides penalty for persons who fail to accomplish Census forms.
* Presidential Decree No. 418 dated March 20, 1974 - Reconstituting the Bureau of Census and Statistics to be known as the National Census and Statistics Office under the administrative supervision of the National Economic and Development Authority.
* Executive Order No. 121 - Reorganization Act of the Philippine Statistical System, dated August 4, 1987 renaming the NCSO to the National Statistics Office which shall be the major statistical agency responsible for generating general purpose statistics.
* Executive Order No. 352 - Designation of Statistical Activities that will generate critical data for decision-making of the Government and Private Sector signed on July 1, 1996.
* Executive Order No. 5 dated July 29, 1998 - Strengthening the National Statistics Office.
Scope and Coverage
The 2006 CPBI covered establishments engaged in 14 economic sectors classified under the amended 1994 Philippine Standard Industrial classification (PSIC) namely:
- A - Agriculture, Hunting and Forestry
- B - Fishing
- C - Mining and Quarrying
- D - Manufacturing
- E - Electricity, Gas and Water Supply
- F - Construction
- G - Wholesale and Retail Trade, Repair and Maintenance of Motor Vehicles, Motorcycles, and Personal and Household Goods
- H - Hotels and Restaurants
- I - Transportation, Storage and Communications
- J - Financial Intermediation
- K - Real Estate, Renting and Business Activities
- M - Private Education
- N - Health and Social Work
- O - Other Community, Social and Personal Service Activities
The following major divisions are excluded from the scope of the survey: L (Public Administration and Defense; Compulsory Social Security), P (Private Households with Employed Persons) and Q (Extra-Territorial Organization and Bodies).
The scope of the 2006 CPBI was confined to the "formal sector" only consisting of the following:
- Corporations and partnership
- Cooperatives and foundations
- Single proprietorships with employment of 10 or more
- Single proprietorships with branches
Unit of Enumeration
Like all other establishment surveys conducted by the NSO, the 2006 CPBI used establishment as the unit of enumeration. It is defined as "an economic unit under a 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". In actual practice, however, there are difficulties in applying the definition of an establishment. Thus, it is defined in operational terms to take into account the organization and record-keeping practices of establishments by making the single location and activity criteria more flexible. This necessitates the use of the kind-of-activity unit for certain sectors as the single location restriction is eliminated.
For Construction, Transportation, storage and communications, Insurance, Real estate buying, developing, subdividing and selling, and Investigation and security activities, the establishment is defined in operational terms as "the unit that is engaged in the production of the most homogeneous 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 production of these goods and services and the materials, labor and physical resources used in this production".
Classification of Establishments
Before the actual selection of samples, the establishments listed in the frame were classified based on economic organization (EO), legal organization (LO), industrial classification, employment size, and geographic location.
Economic organization refers to the organizational structure or role of the establishment in the organization. The following are the types of economic organization:
- Single establishment is an establishment which has neither branch nor main office
- Branch only is an establishment which has a separate main office located elsewhere
- Establishment and main office, both located in the same address and with branches elsewhere
- Main office only is the unit which controls, supervises and directs one or more establishments of an enterprise
- Ancillary unit other than main office is the unit that operates primarily or exclusively for a related establishment or group of related establishments or its parent establishment and provide goods or services that support but do not become part of the output of those establishments
The legal organization provides the legal basis for ownership of the establishment. The following are the types of legal organization:
- Single Proprietorship refers to a business establishment organized, owned, and managed by one person, who alone assumes the risk of the business enterprise. The establishment name is that of a person, or it has words such as Owner, Proprietor or Operator.
- Partnership refers to 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. The establishment name includes words such as Owners, Partners, Limited or LTD., Associates or ASSOCS.
- Government Corporation is a private corporation organized for private aim, benefit or purpose and owned and controlled by the government. The establishment name included words such as Corporation or CORP., INCORPORATED or INC.
- Private Corporation is a corporation organized by private persons. The establishment name includes words such Corporation or Corp, Incorporated or INC.
- Cooperative - the establishment name includes words such as Cooperative or COOP
The industrial classification of an economic unit is determined by the activity from which it derives its major income or revenue. The amended 1994 PSIC is utilized to classify units according to their economic activities.
The amended 1994 PSIC consists of an alpha character and 5 numeric digits. The alpha character, which represents the major division, is denoted by the characters A to Q. The first two numeric digits represent the division; the first three numeric digits, the group; the first four digits, the class; and the 5 digits, the sub-class.
The size of the establishment is determined by its average total employment (ATE). The following are the employment size classification used in the 2006 CPBI:
The geographic or physical location of the establishments was classified in accordance with the Philippine Standard Geographic Code (PSGC) as of December 30, 2006 which contains the latest updates on the number of regions, provinces, cities, municipalities and barangays in the Philippines.
The geographic domains of the 2006 CPBI for establishments with average total employment (ATE) of 20 and over are the provinces, independent component cities, chartered cities and highly urbanized cities and municipalities. On the other hand, the geographic domains for establishments with ATE of less than 20 are the regions.
Hence, the samples of the 2006 CPBI with ATE 20 and over shall provide data for 17 administrative regions, 81 provinces, 39 cities and municipalities. For samples with ATE less than 20, the data that will be presented up to the regional level only.
The 2006 List of Establishments (LE) was used as the frame for the 2006 CPBI. The 2006 LE was based on the combined results of the following:
- 2004 ULE conducted in NCR and selected urban barangays
- 2005 ULE in rural barangays in provincial capitals/cities/municipalities
- Supplemental lists from other sources
The 2006 CPBI used stratified systematic sampling with a random start. For establishments with ATE 20 and over, the geographic domain (provinces, independent component cities, chartered cities and highly urbanized cities and municipalities) and the industry domain (5-digit or group of 5-digit PSIC and/or 4-digit or group of 4-digit PSIC) served as the first stratification variable. On the other hand, for establishments with ATE less than 20, the geographic domains are the regions and the industry domain, the industry groups. Employment size (ATE) was used as the second stratification variable.
The sample size of the 2006 CPBI was 57,404 establishments broken down by ATE of 20 and over (26,448) and ATE of less than 20 (30,956).
The overall response rate for ATE of 20 and over is 97.1 percent or 673 out of 693. These include receipts of "good" questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments. However, the effective response rate is 92.3 percent.
CONCEPTS AND DEFINITIONS OF TERMS
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 establishment's principal source of income. If the establishment is engaged in several activities, its main activity is that which earns the biggest income or revenue.
Employment is the number of persons who worked in or for this establishment as of November 15, 2006.
Average total employment is the sum of the number of persons who worked in or for this establishment for all months of the year divided by 12, regardless of the number of months the establishment is in operation.
Paid employees are 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.
Salaries and wages are payments in cash or in kind to all employees, prior to deductions for employees contributions to SSS/GSIS, withholding tax, etc. Included are total basic pay, overtime pay, and other benefits.
Revenue is the value of goods, products/by-products sold and/or services rendered to others whether paid in cash or is considered receivable by the establishment. Valuation of products/by products sold should be in producers price (ex-establishment), net of discounts and allowances, including duties and charges but excluding subsidies. It also include goods transferred and/or services rendered to other establishment belonging to the same enterprise as the said establishment which should be treated as sales or as if sold to a customer; and revenue from products on a contractual basis from materials supplied by the establishment.
Costs refer to all expenses (excluding compensation) incurred during the year whether paid or payable. Valuation should be at market price including taxes and other charges, net of discounts, rebates, returns and allowances. Goods received from and services rendered by other establishment of the same enterprise are valued as though purchased.
Value added is gross output less intermediate costs.
Gross Output (for Banking Institutions and Non-Bank Financial Intermediation) is equal to the sum of total revenue less interest expense plus capital expenditures of fixed assets produced on own account.
Gross Output (for Insurance and Pension Funding, except Compulsory Social Security and Pre-Need Plan Activities) is equal to the sum of total revenue less insurance claims paid plus capital expenditures of fixed assets produced on own account.
Gross Output (for Administration of Financial Markets, Foreign Exchange Dealing, Activities Auxiliary to Financial Intermediation, except Foreign Exchange Dealing n.e.c and Activities Auxiliary to insurance and Pension Funding) is equal to the sum of total revenue plus capital expenditures of fixed assets produced on own account.
Intermediate costs is equal to the sum of the following cost items: materials and supplies purchased; fuels purchased to run motor vehicles, machinery and other equipments; electricity purchased; industrial services done by others; non-industrial services done by others; computer software expenses; research and experimental development and other costs (plus change in inventory of materials, supplies and fuels).
Fixed assets are physical assets expected to have productive life 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, fixtures, machinery, tool, furniture, office equipment and other fixed assets.
Gross addition to fixed assets is the sum of costs of new and used fixed assets acquired during the year, cost of alteration and improvements done by others and cost of fixed assets produced by the establishment less the value of sales of fixed assets during the year.
Book value of fixed assets is the initial value or acquisition cost of fixed assets less the accumulated depreciation.
Inventories refer to the stocks of goods owned by and under the control of the establishment as of a fixed date, regardless of where the stocks are located. Valuation should be at current replacement cost in purchasers price at the indicated dates. Replacement cost is the cost of an item in terms of its present price rather than its original price.
Change in Inventories is equivalent to the total value of inventories at the end of the year less the value at the beginning of the year.
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 and to protect it against competition.
Source: National Statistics Office