Hog farming industry leads the sector in number of establishments

The final results of the 2013 Annual Survey of Philippine Business and Industry (ASPBI) showed that the country had a total of 2,564 establishments engaged in agriculture, forestry and fishing in the formal sector of the economy. 

Among industry sub-classes, hog farming recorded the highest number with 419 establishments, accounting for 16.3 percent of the total number of establishments. Growing of sugarcane including muscovado sugar-making in the farm ranked second with 344 or 13.4 percent. Chicken broiler production came next with 315 establishments or 12.3 percent share. Other leading industries with more than a hundred number of establishments are as follows:

• Commercial ocean fishing, 212 establishments (8.3%)
• Growing of cavendish banana, 167 establishments (6.5%)
• Contract animal growing services on a fee basis, 165 establishments (6.4%)
• Chicken egg production, 114 establishments (4.4%)
• Chicken layer production, 101 establishments (3.9%)

Figure 1 displays the percentage distribution of all agriculture, forestry and fishing establishments by industry sub-class in 2013.

Growing of cavendish banana industry emerges as the top employer

Total employment of all agriculture, forestry and fishing establishments reached 164,445 in 2013. About 98.4 percent or 161,847 workers of the total employment were paid employees while the remaining 1.6 percent were working owners and unpaid workers.

At the industry level, growing of cavendish banana ranking fifth in terms of number of establishments, emerged as the top employer with 45,298 workers or 27.5 percent of the total. Growing of sugarcane including muscovado sugar-making in the farm ranked second as well, in generating employment with 34,872 workers (21.2%); commercial ocean fishing came next with 15,254 workers (9.3%).

Figure 2 shows the distribution of employment for all agriculture, forestry and fishing establishments by industry sub-class in 2013.

Employees in apiary, vermiculture and raising of semi-domesticated or wild animals receive the highest average annual compensation

Total compensation paid by the sector to its employees in 2013 amounted to PHP28.6 billion, translating to an average annual compensation of PHP176,427 per employee.

By industry sub-class, growing of cavendish banana paid the highest total compensation of PHP13.9 billion, comprising almost half (48.7%) of the total. Growing of sugarcane including muscovado sugar-making in the farm placed a far second with PHP2.5 billion (8.9%). Commercial ocean fishing activities ranked third with PHP2.3 billion (7.9%).

Employees in apiary, vermiculture and raising of semi-domesticated or wild animals earned an average annual compensation of PHP846,515. This was distantly followed by growing of leafy and stem vegetables, and services to establish crops, promote their growth and protect them from pests and diseases with respective average annual pay of PHP435,300 and PHP419,137.Other leading industries in terms of average annual compensation are as follows:

• Growing of corn, except young corn (vegetables), PHP361,236

• Growing of cavendish banana, PHP309,852

• Growing of paddy rice, lowland, irrigated, PHP230,583

• Culture of freshwater crustaceans (except prawns), bivalves, and other mollusks, PHP216,737

Figure 3 shows the average annual compensation of employees for all agriculture, forestry and fishing establishments by industry sub-class in 2013.

Growing of cavendish banana generates highest value of output

Total value of output generated by all agriculture, forestry and fishing establishments reached PHP144.7 billion in 2013.

Combined value of output of the top three industries comprised more than half (59.8%) of the total. Growing of cavendish banana generated the highest value of output with PHP53.9 billion or 37.3 percent. Hog farming and chicken broiler production came second and third with respective output value of PHP17.6 billion (12.2%) and PHP14.9 billion (10.3%). Figure 4 illustrates the percentage distribution of value of output for all agriculture, forestry and fishing establishments by industry sub-class in 2013.

Growing of cavendish banana accounts for 38.2 percent of total expense

Total expense, including compensation, for all agriculture, forestry and fishing establishments amounted to PHP145.8 billion.

Among industries, growing of cavendish banana incurred the highest expense amounting to PHP55.7 billion or 38.2 percent of the total expense for the sector. Hog farming ranked second with PHP17.2 billion (11.8%), followed by chicken broiler production with PHP14.4 billion (9.9%). Listed below are the remaining industries which spent more than PHP2.0 billion in their business operations in 2013:

• Commercial ocean fishing, PHP14.4 billion (9.8%)

• Growing of pineapple, PHP5.8 billion (4.0%)

• Growing of sugarcane including muscovado sugar-making in the farm, PHP5.6 billion (3.9%)

• Chicken egg production, PHP5.0 billion (3.4%)

• Growing of corn, except young corn (vegetable), PHP3.0 billion (2.0%)

• Chicken layer production, PHP2.5 billion (1.7%)

Income per expense ratio returns at 1.02

The sector generated a modest income per expense ratio of 1.02 in 2013. This means that for every peso spent, a corresponding income of PHP1.02 was generated.

At industry level, growing of corn, except young corn (vegetable) recorded the highest income per expense ratio of 1.63 among the top ten industries, followed by support services to forestry with 1.49. Completing the top ten industries in terms of income per expense ratio are the following:

• Operation of irrigation systems through cooperatives, 1.29

• Growing of paddy rice, lowland, irrigated, 1.21

• Growing of fruit bearing vegetables, 1.20

• Chemical and mechanical weed control, disease and pest control services, 1.16

• Growing of coconut, including copra-making, tuba gathering and coco-shell charcoal making in the farm, 1.15

• Municipal coastal fishing, 1.14

• Egg-hatching, sex determination and other poultry services, 1.13

• Plant propagation, 1.13

Growing of cavendish banana produces the highest value added

In 2013, value added produced by all agriculture, forestry and fishing establishments was estimated at PHP40.7 billion.

Among industry sub-classes, growing of cavendish banana generated the highest value added estimated at PHP16.5 billion or 40.6 percent of the total.Commercial ocean fishing came in second with PHP4.2 billion (10.2%), followed by growing of sugarcane including muscovado sugar-making in the farm with PHP3.0 billion (7.3%).

Labor productivity stands at PHP247,682 per worker

Ratio of value added to employment, a measure of labor productivity, was recorded at PHP247,682 per worker in 2013.

Culture of freshwater crustaceans (except prawns), bivalves, and other mollusks generated a labor productivity of PHP2.4 million per worker, the highest among industries. Growing of corn, except young corn (vegetables) closely followed with PHP2.3 million per worker while growing of paddy rice came next with PHP910,495 per worker. Other leading industries in terms of labor productivity are shown below.

• Operation of freshwater fish breeding farms and nurseries, PHP722,741 per worker

• Chemical and mechanical weed control, disease and pest control services, PHP625,091 per worker

• Growing of fruit bearing vegetables, PHP565,740 per worker

• Prawn culture in brackish water, PHP534,924 per worker

• Growing of leafy and stem vegetables, PHP520,805 per worker

Figure 5 displays the labor productivity for all agriculture, forestry and fishing establishments by industry sub-class in 2013.

Gross addition to tangible fixed assets reaches PHP12.4 billion

Gross addition to tangible fixed assets acquired by all agriculture, forestry and fishing establishments was valued at PHP12.4 billion in 2013.

Combined share of the top three industries accounted for almost half (47.1%) of the total gross addition to tangible fixed assets. Growing of cavendish banana acquired PHP3.0 billion (23.9%) worth of gross addition to fixed assets, followed by chicken broiler production and commercial ocean fishing with PHP1.8 billion (14.9%) and PHP1.0 billion (8.3%), respectively. Other industries which registered more than half a billion pesos of gross addition to fixed assets are as follows:

• Hog farming, PHP737.9 million (5.9%)

• Operation of freshwater fish breeding farms and nurseries, PHP520.2 million (4.2%)

Total subsidies received amounts to PHP6.3 billion

Subsidies granted by the government to support the business operation of all agriculture, forestry and fishing establishments amounted to PHP6.3 billion in 2013.

Among industries, services to establish crops, promote their growth and protect them from pests and diseases received the highest subsidies with PHP5.1 billion or 80.7 percent of the total. This was distantly followed by dairy farming receiving PHP26.7 million or less than 1 percent share to total subsidies.

TECHNICAL NOTES

Introduction

This Special Release presents the final results of the 2013 ASPBI for all agriculture, forestry and fishing establishments.

The 2013 ASPBI is one of the designated statistical activities of the Philippine Statistics Authority (PSA). Its forerunner is the 2010 ASPBI. Data collected from the survey provide information on the levels, structure, performance, and trends of economic activities of the formal sector in the entire country for the year 2013.

The survey was conducted nationwide in September 2014 with the year 2013 as the reference period of data, except for employment which is as of November 15, 2013.

Beginning with the 2013 ASPBI, the data processing was done on a decentralized set-up particularly by the provincial offices. The set-up is in line with the PSA’s strategic direction to decentralize the data processing of surveys to the field offices. A new strategy in data processing was implemented through the use of an online system called the Establishment Data Management System.

Data are presented at the national and industry sub-class or 5-digit 2009 Philippine Standard Industrial Classification (PSIC).

Legal Authority

The conduct of the 2013 ASPBI is authorized under Republic Act 10625 known as the Philippine Statistical Act of 2013 - Reorganizing and strengthening of the Philippine Statistical System (PSS), its agencies and instrumentalities.

Scope and Coverage

The 2013 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 of Motor Vehicles and 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 Work 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

Hence, the 2013 ASPBI covered only the following economic units:

• All establishments with total employment (TE) of 10 or more, and;

• All establishments with TE of less than 10, except those establishments with Legal Organization = 1 (single proprietorship) and Economic Organization = 1 (single establishment), that are engaged in economic activities classified according to the 2009 Philippine Standard Industrial Classification (PSIC).

Frame of Establishments

The frame for the 2013 ASPBI was extracted from the 2013 List of Establishments (LE). The estimated number of establishments in operation in the country in 2013 totaled to 941,000. About 263,000 establishments (28.0% of the total establishments) belong to the formal sector of which 239,000 (87.0%) comprised the establishment frame. This frame was used to draw the sample establishments for the survey.

Unit of Enumeration

The unit of enumeration for the 2013ASPBI is the establishment. An establishmentis 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.

Classification of Establishments

An establishment is categorized by its economic organization, legal organization, industrial classification, employment size, and geographic location.

Economic Organization refers to the organizational structure or role of the establishment in the organization.  An establishment may be single establishment, branch, establishment and main office with branches elsewhere, main office only, and ancillary unit other than main office.

Legal Organization refers to the legal form of the economic entity which owns the establishment. An establishment may be single proprietorship, partnership, government corporation, stock corporation, non-stock corporation, and cooperative.

The industrial classification of an economic unit was determined by the activity from which it derives its major income or revenue.  The 2009 PSIC was utilized to classify economic units according to their economic activities.

The size of an establishment is determined by its total employment (TE) as of a specific date. 

Geographic Classification refers to the classification by geographic area using the Philippine Standard Geographic Code (PSGC) classification.

Methodology

Sampling Design

The 2013 ASPBI used stratified systematic sampling with 5-digit PSIC serving as first stratification variable and employment size as the second stratification variable.

Estimation Procedure

1. Non-Certainty Stratum (strata of TE 20 to 49 and TE 50 to 99)

The estimate of the total of a characteristic for the non-certainty employment strata in an industry domain in each region was

where:

s       denotes the non-certainty employment strata in TE of 20 and over

p      = 1, 2,..., 17  regions (geographic domains)

x_{sp j}= value of the j^th establishment in the non-certainty employment strata in TE of 20 and over for an industry domain in each region

j       = 1, 2, 3,…, n_spestablishments

= weight of the j^th establishment in the non-certainty employment strata in TE of 20 and over for an industry domain in each region

N_sp  = total number of establishments in the non-certainty employment strata in TE of 20 and over for an industry domain in each region

n_sp  = number of sample establishments in the non-certainty employment strata in TE of 20 and over for an industry domain in each region

2. Certainty Stratum (TE 100 and over)

The estimate of the total of a characteristic for the certainty employment stratum in an industry domain in each region was

where:

c      denotes the certainty employment strata in TE of 20 and over

p      = 1, 2,..., 17 regions (geographic domains)

x_cpj  = value of the j^th establishment in the certainty employment strata in TE of 20 and over in an industry domain within each region

j     = 1, 2, 3, …, m_cp establishments

m_cp   = number of establishments in the certainty employment strata in TE of 20 and over in an industry domain within each region

3. Total Estimate for TE of 20 and Over

The estimate of the total of a characteristic  for the industry domain in each region (geographic domain) was obtained by aggregating the estimates for all employment strata (non-certainty and certainty) in the same industry domain,

where   dp  denotes the industry domains in each region.

National level estimates of the characteristics by industry domain were obtained by aggregating separately the estimates for the particular industry domain from all the regions.

4. Non-Certainty Stratum (TE of Less Than 20)

The estimate of the total of a characteristic  forthe non-certainty employment stratum TE less than 20 in the s^th industry domain was

 where:

s    = denotes the non-certainty employment strata in TE of less than 20

Xsj = value of the j^th establishment in non-certainty employment stratum in TE of less than 20 in S^th industry domain

j     = 1,2,3..., n_s establishments

W_sj = weight of the j^th establishment in the non-certainty employment stratum of less than 20 in the s^th industry domain

N_s = total number of establishments in the non-certainty employment stratum in TE of less than 20 in the s^th industry domain

n_s = number of sample establishments in the non-certainty employment stratum in TE of less than 20 in s^th domain

Weight Adjustment Factor for Non-Response

To account for non-response in the non-certainty strata, the adjustment factor (n/n’) was multiplied with the sampling weight (W) of each of the sampling unit. The sampling weight, defined as N/n, was recomputed as

Thus, the adjusted weight (W’sj) for employment stratum in TE 1-9 or TE 10-19 was

where:

N_s= total number of establishments in the employment stratum in TE 1-9 or TE 10-19 in the s^th industry domain

n'_s = number of responding establishments in the employment stratum in TE 1-9 or TE 10-19 in the s^th industry domain

For the non-certainty employment stratum for the industry domain with TE 20-99, the adjusted weight (W’_spj) was

where:

N_sp  =  total number of establishments in the non-certainty employment stratum with TE 20-99 for the industry domain within each geographic domain (region)

n’_sp  = number of responding establishments in the non-certainty employment stratum with TE 20-99 for the industry domain within each geographic domain (region)

Response Rate

Response rate for Agriculture, Forestry and Fishing Sector was 86.0 percent (996 out of 1,158 establishments). This included receipts of "good" questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments. 

Reports of the remaining non-reporting establishments were imputed based on established imputation methods and from other available administrative data sources.  However, reports of establishments which were found to be duplicates and out of business in 2013, were not imputed.

Limitation of Data

Only the formal sector was covered in the survey.

Concepts and Definitions of Terms

Economic activity is the establishment’s source of income. If the establishment is engaged in several activities, its main economic activity is that which earns the biggest income or revenue.

Total employment is the number of persons who worked in for the establishment as of November 15, 2013.

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.

Compensation is the sum of salaries and wages, separation/retirement/terminal pay, gratuities, and payments made by the employer in behalf of the employees such as contribution to SSS/GSIS, ECC, PhilHealth, Pag-ibig, etc.

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.

Income or Revenue refers to cash received and receivables for goods/products and by-products sold and services rendered.

E-commerce refers to the selling of products or services over electronic systems such as Internet Protocol-based networks and other computer networks. Electronic Data Interchange (EDI) network, or other on-line system. Excluded are orders received from telephone, facsimile and e-mails.

Expense refers to cost incurred in an enterprise effort to generate revenue, representing the cost of doing business. This is treated on a consumed basis. It excludes cost incurred in the acquisition of income generating assets.

Intermediate expense are expenditures incurred in the production of goods such as materials and supplies used, fuels lubricants, oils and greases used; electricity and water purchased; agricultural/forestry/fishery and industrial services done by others.

Value addedis gross output less intermediate input. Gross output for the agriculture, forestry and fishing sector is value of outputplusincome from non-industrial services done for others (except rent income from land). Intermediate input is intermediate expense plus non-industrial services done by others (except rent expense for land) and all other expenses.

Value of outputrepresents the sum of the receipts from products and by-products sold, agricultural/forestry/fishery services rendered, industrial services done for others, and goods sold in the same condition as purchased less the cost of goods sold; and value of fixed assets produced on own account and change in inventories of finished products and work-in-progress.

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

Change in inventories is equivalent to the value of inventories at the end of the year less the value of inventories at the beginning of the year.

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.