Higher education sector has the largest number of establishments

Final results of the 2010 Annual Survey of Philippine Business and Industry (ASPBI) conducted nationwide covered a total of 9,949 establishments engaged in private education. As shown in Figure 1, higher education garnered the highest number of establishments at 2,583 (26.0%). Secondary/high school education followed next with 2,547 (25.6%) while the least number of establishments were recorded in other education services with 1,082 (10.9%).

Establishments providing higher education employ the most number of workers

Employment for the sector reached a total of 315,676. Out of this total, 306,648 or 97.1 percent were paid employees while the remaining 9,044 or 2.9 percent were working owners and unpaid workers.

Higher education had the most number of employees with 168,614 or 53.4 percent of the total. Secondary/high school education followed with 83,263 employees (26.4%). The least number of employees were employed by other education services with 12,052 or 3.8 percent. (See Figure 2)

The sector recorded an average number of 32 workers per establishment. Higher education posted the largest number at 65 followed by secondary/high school education with 33 workers. Pre-primary/pre-school education, however, ranked last with only 10 workers per establishment.

Higher education employees receive the highest average annual compensation

Total compensation paid by Education sector amounted to PHP60.0 billion, translating to an average annual compensation of PHP195,662 per employee.

Across industries, higher education paid the highest average annual compensation of PHP230,864 per employee followed by other education services with PHP188,647. On the other hand, establishments providing pre-primary/pre-school education provided the lowest average annual pay of PHP98,708 per employee.

Top earners are establishments engaged in higher education services

Revenue generated by the sector reached PHP135.7 billion. Higher education contributed the biggest share with PHP88.8 billion or 65.5 percent of the total revenue. Second biggest revenue generating industry was secondary/high school education with PHP26.1 billion or 19.3 percent. Pre-primary/pre-school education generated the least revenue among the industry group at PHP3.9 billion or 2.9 percent.

Total cost reaches PHP53.9 billion, Higher education spends the highest

Total cost (excluding compensation) incurred by the sector in 2010 amounted to PHP53.9 billion. Higher education incurred the highest cost of PHP35.2 billion (65.3%). Pre-primary/pre-school education had the lowest cost of PHP1.5 billion (2.8%). Figure 4 shows the revenue generated and cost incurred by Private Education sector by industry group.

Revenue per Cost

The revenue generated per peso cost stood at PHP2.52. Among industries, secondary/high school education recorded the highest with PHP2.81 while other education services registered the lowest with PHP1.95 revenue per peso cost.

Value added amounts to PHP93.9 billion

Value added for the sector was estimated at PHP93.9 billion. Almost PHP61.8 billion or 65.8 percent of the total value added was contributed by higher education. On the other hand, pre-primary/pre-school education reported the lowest with PHP2.7 billion. Figure 5 displays the distribution of value added by industry group.

Employees of Other education services are the most productive

Value added per worker, a measure of labor productivity, was valued at PHP297,520. Figure 5 shows that other education services had the highest average of PHP393,736 among industries. Pre-primary/pre-school education had the lowest average of PHP127,548.

Gross Additions to Tangible Fixed Assets totals PHP13.3 billion

The sector acquired a total of PHP13.3 billion worth of fixed assets in 2010. Higher education industry recorded the highest among the industry with PHP9.8 billion or 73.3 percent of the total. Pre-primary/pre-school education had the least gross additions to tangible fixed assets with PHP180.9 million or 1.4 percent.

Total change in inventories values at negative PHP35.8 million

Change in inventories, defined as the value of ending less the beginning inventory, amounted to negative PHP35.8 million. Among industries, only higher education and secondary/high school education reported positive change in total inventories.

Subsidies total to PHP1.6 billion

Subsidies in 2010 reached PHP1.6 billion with the government providing grants to all the industries in the sector. Higher education received the highest grant amounting to PHP812.0 million (50.1%), followed by secondary/high school education with PHP730.4 million or 45.0 percent. Other education services received the least subsidy from the government with PHP12.0 million or 0.7 percent of the total.

TECHNICAL NOTES

Introduction

The 2010 Annual Survey of Philippine Business and Industry (ASPBI) is a continuing activity of the National Statistics Office (NSO) which aims to provide key measures on the performance, levels, structure and trends of economic activities in the entire country for the year 2010. It is one of the designated statistical activities of the government and as such the survey generates the most critical and essential statistics required for economic planning and analysis.

The 2009 Philippine Standard Industrial Classification (PSIC) was adopted for the first time in this round. This is the latest version of the classification of industries in the country released by the NSCB after the 1994 PSIC was amended in 2002. It conforms with the International Standard Industrial Classification (ISIC) Revision 4 prescribe by the United Nations, but with modifications to suit national situation and requirement. The PSIC is a statistical classification of all economic activities, designed as a guide and a comprehensive framework for securing uniformity and comparability of both the government and private sectors.

The conduct of the ASPBI is governed by legislative acts and presidential directives, specifically Commonwealth Act No. 591 which was approved on August 19, 1940.

Scope and coverage

The 2010 ASPBI covered establishments engaged in 18 economic sections classified under the 2009 Philippine Standard Industrial classification (PSIC) namely:

• Agriculture, Forestry and Fishing
• Mining and Quarrying
• Manufacturing
• Electricity, Gas, Steam and Air Conditioning Supply
• Water Supply, Sewerage, Waste Management and Remediation Activities
• Construction
• Wholesale and Retail Trade; Repair of Motor Vehicles and Motorcycles
• Transportation and Storage
• Accommodation and Food Service Activities
• Information and Communication
• Financial and Insurance Activities
• Real Estate Activities
• Professional, Scientific and Technical Services
• Administrative and Support Service Activities
• Education
• Human Health and Social Work Activities
• Arts, Entertainment and Recreation
• Other Service Activities

The scope of the ASPBI was confined to “formal sector” only, which consists of the following:

• Corporations and partnership
• Cooperatives and foundations
• Single proprietorships with employment of 10 or more
• Single proprietorships with branches

Like all other establishment surveys conducted by the NSO, the 2010 ASPBI 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.”.

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 organizations relates 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 provides 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 is an organization composed primarily of small producers/consumers who voluntarily join together to form a business enterprise, which they themselves own, control and patronize. The establishment’s 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 2009 PSIC is utilized to classify units according to their economic activities. It was approved for adoption by government agencies and instrumentalities through NSCB Resolution # 2 Series of 2010 signed on February 10, 2010. It will be used for the first time for ASPBI.

  The 2009 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 U. 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 total employment (TE). The following are the employment size classification used in the 2010 ASPBI:

  

  The geographic or physical location of the establishments was classified in accordance with the Philippine Standard Geographic Code (PSGC) as of December 31, 2010 which contains the latest updates on the number of regions, provinces, cities, municipalities and barangays in the Philippines.

  The geographic domains of the 2010 ASPBI for establishments with TE of 20 and over are the 17 administrative regions while the whole country serves as the geographic domain for establishments with TE of less than 20.

  Hence, the samples of the 2010 ASPBI with TE of 20 and over shall provide data for 17 administrative regions. For samples with TE of less than 20, the data that will be presented is limited only at the national level.

  Response rate

  A total of 1,075 or 98.6 percent of sample establishments responded. These include receipts of “good” questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments.

  CONCEPTS AND DEFINITIONS OF TERMS

  Economic activity or business is the activity of the establishment as classified under the 2009 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.

  Total employment is the number of persons who worked in or for this establishment as of November 15, 2010.

  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 employee’s 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 producer’s 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.

  Cost refers to all expenses excluding compensation incurred during the year whether paid or payable. Valuation should be at purchaser 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.

  Fixed assets are physical assets expected to have 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, machinery and equipment, furniture, fixtures, and other fixed assets.

  Book value of tangible fixed assets is the initial value or acquisition cost of tangible fixed assets less the accumulated depreciation.

  Gross additions to tangible fixed assets is the sum of cost 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.

  Value added is gross output less intermediate input.

  Gross output for Private Education is the sum of the total revenue (less interest income, rent income from land, dividend income, royalty income, franchise income and foreign exchange gains), capital expenditures of fixed assets produced on own account and change in inventories.

  Intermediate input is equal to the sum of the following cost items: materials and supplies purchased; fuels, lubricants, oils and greases purchased; electricity and water purchased; cost of industrial services done by others; cost of non-industrial services done by others; goods purchased for resale; research and experimental development expense; environmental protection expense; royalty fee; franchise fee and other cost.

  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 purchaser’s 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 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.