Top ten manufacturing industries account for more than half of the total number of establishments

The total number of manufacturing establishments with total employment (TE) of 20 and over was estimated at 4,643 according to the preliminary results of the 2010 Annual Survey of Philippine Business and Industry.

Among the industry groups, the top ten manufacturing industries shown below accounted for more than half (50.5%) of the total number of establishments. These are:

• Other food products (410 establishments)
• Wearing apparel, except fur apparel (347 establishments)
• Plastic products  (337 establishments)
• Printing and service activities related to printing (236 establishments)
• Other fabricated metal products; metal working service activities (233 establishments)
• Furniture (214 establishments)
• Paper and paper products (157 establishments)
• Other chemical products, n.e.c. (146 establishments)
• Non-metallic mineral products, n.e.c. (136 establishments)
• Electronic components (131 establishments).

Figure 1 shows the percent distribution of number of manufacturing establishments with total employment of 20 and over by industry group.

Among regions, the National Capital Region (NCR) accounted for the highest number of establishments with TE of 20 and over at 1,898 or 40.9 percent of the total in 2010. CALABARZON followed with 1,212 establishments (26.1%). A far third is Central Visayas which registered 491 establishments (10.6%).

Electronic components industry employs the most number of workers

In 2010, manufacturing establishments with TE of 20 and over generated a total employment of 871,796. Of this, 99.8 percent were paid employees while the rest were working owners and unpaid workers.

In terms of employment generation, industries comprising the top ten slots accounted for 55.7 percent (485,757 workers) of the total employment in manufacturing establishments with TE of 20 and over. Electronic components employed the most number of workers with 117,227 or 13.4 percent of the total. Wearing apparel, except fur apparel ranked second with 85,805 workers (9.8%). This was followed by Other food products with 53,889 workers (6.2%).

Other industries comprising the top ten slots are:

• Computers and peripheral equipment and accessories (53,133 workers)
• Parts and accessories for motor vehicles (44,388 workers)
• Plastic products (34,488 workers)
• Processing and preserving of fruits and vegetables (28,672 workers)
• Other fabricated metal products; metal working service activities (26,783 workers)
• Building of ships and boats (22,155 workers)
• Processing and preserving of fish, crustaceans and mollusks (19,217 workers)

Figure 2 shows the percent distribution of employment of manufacturing establishments with total employment of 20 and over by industry group.

Regionwise, CALABARZON where most of the export processing zones are located employed the highest number of workers (357,512) accounting for more than one-third (41.0%) of the total workforce. NCR and Central Visayas stood as the second and third top employers, with 186,826 and 111,067 workers, respectively.

Refined petroleum products industry pays the highest average annual compensation

In 2010, total compensation paid to employees by manufacturing establishments with TE of 20 and over amounted to PHP192.1 billion or equivalent to an average annual income of PHP220,835 per employee.

Among industries, Refined petroleum products paid the highest compensation with average annual pay of PHP1.6 million per employee in 2010. Other top-paying industries that exceeded the sector’s average annual compensation are shown in Table 1.

Table 1  Average Annual Compensation of Employees in Top-Paying Manufacturing Establishments

with Total Employment of 20 and Over by Industry Group: Philippines, 2010

Electronic components industry generates the highest output value

Value of output of manufacturing establishments with TE of 20 and over was estimated at PHP3.5 trillion in 2010. More than half (57.2%) of the total value of output of manufacturing establishments with TE of 20 and over was accounted for by ten industry groups led by Electronic components with an output share of 15.0 percent (PHP526.5 billion). Refined petroleum products followed as the second leading industry in terms of value of output with a share of 11.2 percent (PHP394.1 billion). Rounding up the top ten industries are the following:

• Computers and peripheral equipment and accessories, PHP183.4 billion (5.2%)
• Beverages, PHP155.9 billion (4.4%)
• Other food products, PHP151.5 billion (4.3%)
• Dairy products, PHP147.7 billion (4.2%)
• Parts and accessories for motor vehicles, PHP133.3 billion (3.8%)
• Basic precious and other non-ferrous metals, PHP113.7 billion (3.2%)
• Motor vehicles, PHP110.0 billion (3.1%)
• Non-metallic mineral products, n.e.c., PHP99.5 billion (2.8%)

Figure 3 shows the top ten industries that generated the highest value of output for manufacturing establishments with total employment of 20 and over in 2010.

Across the country, the top three regions that contributed more than three-fourths (76.7%) of the total value of output are the following:

• CALABARZON, PHP1,492.2 billion (42.6%)
• NCR, PHP681.9 billion (19.4%)
• Central Luzon, PHP514.1 billion (14.7%)

Refined petroleum products industry tops among the most labor productive industries

Value added generated by manufacturing establishments with TE of 20 and over reached PHP889.6 billion in 2010.

Among the industry groups, the combined value added of ten industries accounted for more than half (56.9%) of the total. Electronic components led the top contributors to value added with PHP116.7 billion or 13.1 percent of the total. Beverages placed second accounting for PHP59.5 billion or 6.7 percent of the total value added.

The ratio of value added to total employment, or a simple measure of total productivity, was recorded at PHP1.0 million.

Table 2 shows the ten most labor productive manufacturing industries in 2010.

Table 2  Most Labor Productive Industries for Manufacturing Establishments with Total Employment of 20 and Over by Industry Group: Philippines, 2010

At the regional level, CALABARZON contributed the largest share to value added at 39.9 percent (PHP354.6 billion) of the total. This was followed by NCR with 22.7 percent (PHP202.2 billion). Central Luzon accounted for the third largest share with 14.6 percent (PHP129.6 billion).

Gross addition to tangible fixed assets reaches PHP103.2 billion

Gross addition to tangible fixed assets registered a value of PHP103.2 billion in 2010. Electronic components posted the highest amounting to PHP33.2 billion or 32.2 percent of the total. Tobacco products followed as a far second with PHP8.5 billion (8.3%), while Refined petroleum products registered PHP6.5 billion or 6.3 percent.

Among regions, the top three regions in terms of gross addition to tangible fixed assets comprised 73.1 percent of the total. CALABARZON recorded the highest gross addition at PHP45.8 billion or 44.4 percent.  NCR ranked second with PHP17.2 billion (16.7%), followed by Central Luzon which posted PHP12.4 billion (12.0%).

General purpose machinery industry receives PHP371.7 million worth of subsidies

Subsidies are special grants in the form of financial assistance or tax exemption or tax privilege received from the government to aid and develop an industry. Subsidies received by manufacturing establishments with total employment of 20 and over amounted to PHP641.9 million in 2010.

Industrywise, General purpose machinery received PHP371.7 million worth of subsidies. Spinning, weaving and finishing of textiles followed next with PHP204.5 million, while Electronic components recorded PHP33.0 million.

TECHNICAL NOTES

Introduction

The Special Release presents the preliminary results of the 2010 Annual Survey of Philippine Business and Industry (ASPBI) for manufacturing establishments with total employment of 20 and over.

As one of the designated statistical activities of the National Statistics Office (NSO), the 2010 ASPBI is aimed at collecting and generating information on the levels, structures and trends of economic activities in the country.

The survey was conducted nationwide in April 2011 with the year 2010 as the reference period of data, except for employment which is as of November 15, 2010. The 2009 Philippine Standard Industrial Classification (2009 PSIC) was adopted for the first time in this survey.

Data are presented at the national and industry group or 3-digit 2009 PSIC and regional level.   

Legal Authority

The conduct of 2010 ASPBI is authorized under the following legislative acts and presidential directives:

• Commonwealth Act 591
• Presidential Decree No. 418
• Executive Order No. 121
• Executive Order No. 352
• Executive Order No. 5

Scope and Coverage

The 2010 ASPBI covered establishments engaged in 18 economic sectors classified under the 2009 PSIC, namely:

• Agriculture, Forestry and Fishing (A)
• Mining and Quarrying (B)
• Manufacturing (C)
• Electricity, Gas, Steam, and Air Conditioning Supply (D)
• Water Supply; Sewerage, Waste Management and Remediation Activities (E)
• Construction (F)
• Wholesale and Retail Trade; Repair and Maintenance of Motor Vehicles, Motorcycles (G)
• Transportation and Storage (H)
• Accommodation and Food service activities (I)
• Information and Communication (J)
• Financial and Insurance Activities (K)
• Real Estate Activities (L)
• Professional, Scientific and Technical Activities (M)
• Administrative and Support Service Activities (N)
• Education (P)
• Human Health and Social Activities (Q)
• Arts, Entertainment and Recreation (R)
• Other Service Activities (S)

The survey was confined to the formal sector of the economy, which consists of the following:

• Corporations and partnership
• Cooperatives and foundations
• Single proprietorship with employment of 10 and over
• Single proprietorships with branches

Unit of Enumeration

Like all other establishments surveys conducted by the NSO, the 2010 ASPBI unit of enumeration is the establishment. The establishment is defined as an economic unit under a single ownership or control which engages in one or predominantly one kind of activity at a single fixed location.

Methodology

Sampling Design

The survey utilized stratified sampling with five-digit PSIC serving as the first stratification variable and total employment as the second stratification variable.

Estimation Procedure for Establishments with TE of 20 and over

b. Certainty Stratum

Response Rate

The response rate for establishments with TE of 20 and over is 95.0 percent. These include receipts of “good” questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments, etc.

Reports of the remaining non-reporting establishments were imputed based on established imputation methods and from other available data sources.  However, reports of establishments in the certainty stratum, which were found to be duplicates and out of business in 2010, were not imputed.

Limitation of Data

Only the formal sector was covered in the survey.

In the table presented, so as not to disclose individual establishment’s data on musical instruments industry was combined with other manufacturing.

Concepts and Definitions of Terms

Establishment is an economic unit under a single ownership control, i.e., under a single entity, engaged in one or predominantly one kind of economic activity at a single fixed location.

Total employment is the number of persons who worked in for the 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, receiving pure commissions only and workers on indefinite leave.

Unpaid workers are persons working for at least one-third of the working time normal to the establishment and do not receive regular pay.        

Compensation is the sum of salaries and wages, separation, terminal pay and gratuities paid by the establishment to its employees and total employer’s contribution to SSS/GSIS, ECC, PhilHealth, PAG-IBIG etc.

Revenue includes cash received and receivables for goods/products and by-products sold and services rendered. Valuation is at producer prices (ex-establishment) net of discounts, and allowances, including duties and taxes but excluding subsidies.

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

Value of output represents the sum of the value of products and by-products sold, receipt from industrial services done for others, receipts from goods sold in the same condition as purchased less cost of goods sold, fixed assets produced on own account, and change in inventories of finished products and work-in-progress.

Intermediate cost refers to expenses incurred in the production of goods and industrial services such as materials and supplies purchased, fuels purchased, electricity purchased and industrial services done by others plus beginning inventory of materials, supplies and fuels less ending inventory of materials, supplies and fuels.

Value added is gross output less intermediate input. Gross output for the manufacturing sector is value of output plus industrial services done for others. Intermediate input is intermediate cost plus non-industrial services done by others and all other cost.

Gross addition to fixed assets is equal to capital expenditures less sale of fixed assets, including land.

Change in total inventories is computed as the total value of ending inventory less the total beginning inventory.

Subsidies are all special grants in the form of financial assistance or tax exemption or tax privilege given by the government to aid and develop an industry.