Private secondary education leads the sector

Final results of the 2014 Annual Survey of Philippine Business and Industry covered a total of 14,052 establishments engaged in education sector except public education services.  Of the total, 10,506 (74.8%) had a total employment (TE) of less than 20, and the rest were establishments with total employment of 20 and over with 3,546 or 25.2 percent.

Among industry groups, secondary/high school education led the sector with 3,389 establishments or 24.1 percent of the total.  This was followed by establishments engaged in pre-primary/pre-school education with a total of 3,093 (22.0%).  Educational support services industry had the least number of establishments with 15 or 0.1 percent.  Figure 1 shows the percentage distribution of private education services for all establishments by industry group in 2014.

Higher education establishments employ the highest number of workers

Employment for the sector reached a total of 371,787 in 2014. Out of the total, 258,709 or 69.6 percent were accounted for by establishments with TE of 20 and over while the remaining 113,079 or 30.4 percent were for establishments with TE of less than 20.

In 2014, establishments in higher education industry hired the highest number of workers at 175,529 or 47.2 percent of the total.  Secondary/high school education and primary/elementary education ranked second and third, with employment of 96,411 (25.9%) and 41,771 (11.2%), respectively.  Figure 2 shows the distribution of employment for private education services by industry group in 2014.

The sector recorded an average number of 26 workers per establishment.  Private higher education industry posted the highest average number of 71 employees, followed by secondary/high school education and educational support industries, with an average of 28 and 17 workers, respectively.  Pre-primary/pre-school education ranked last with 11 workers per establishment.

Educational support services employees receive the highest average annual compensation

Total compensation paid by the sector amounted to PHP78.2 billion, translating to an average annual compensation of PHP215.4 thousand per employee.  For establishments with TE of 20 and over, the average annual compensation reached to PHP258.4 thousand while for employees of establishments with TE of less than 20, the average annual compensation was PHP112.8 thousand per employee.

Across industries, employees of educational support service industry were paid the highest average annual compensation of PHP413.5 thousand, followed by higher education industry, with PHP279.4 thousand.  On the other hand, workers of private pre-primary/pre-school education industry had the lowest average annual pay of PHP105.7 thousand per employee. Figure 3 shows the average annual compensation per employee for private education services by industry group.

Higher education industry is highest earner and highest spender

Income generated by the private education services in 2014 was PHP175.5 billion.  Higher education industry generated the biggest share of PHP115.1 billion or 65.6 percent of the total income.  Second biggest income generating industry was secondary/high school education with PHP333.7 billion or 19.2 percent. Ranked third and fourth industries as to income generation were other education services and primary/elementary education industries, with PHP11.0 billion (6.3%) and PHP9.1 billion (5.2%), respectively.  On the other hand, educational support services industry generated the lowest income of PHP274.2 million.

Private education services incurred a total expense of PHP152.3 billion. Higher education, being the highest generating industry also incurred the highest expense of PHP97.6 billion (64.1%). Other industries which contributed about one-third of the expense were the following:

Figure 4 shows the income generated and expense incurred by private education services by industry group in 2014.

Income per peso expense stands at 1.15

The income generated per peso expense stood at 1.15.  This means that for every peso spent in the operation of business, an income of PHP1.15 was generated.  Among industries, private higher education industry recorded the highest with 1.18.  Private pre-primary/pre-school education industry posted the least with PHP1.07 income per peso expense.

Value added amounts to PHP117.7 billion

Value added for the private education services was estimated at PHP117.7 billion.  Of the total, more than 85 percent or PHP100.6 billion was accounted for establishments with TE of 20 and over and the remaining PHP17.1 billion (14.6%) for establishments with TE of less than 20.

Among industries, higher education contributed the highest value added of PHP77.6 billion or 65.9 percent of the total. Secondary/high school education and primary/elementary education ranked second and third, with PHP23.8 billion (20.2%) and PHP6.2 billion (5.3%) respectively. Establishments in educational support services industry had the lowest share of value added amounting to PHP128.2 million.  Figure 5 shows the distribution of value added of private education services by industry group.

Employees of educational support services are the most productive

Value added per total employment, a measure of labor productivity, was valued at PHP316.6 thousand per employee.  Educational support services had the highest labor productivity of PHP517.1 thousand among industries.  Primary/elementary education workers were the least productive with PHP120.0 thousand per total employment.

Gross addition to tangible fixed assets totals PHP13.0 billion

The sector acquired a total of PHP13.0 billion worth of fixed assets in 2014.  More than 95.0 percent of the total was acquired by establishments with TE of 20 and over while the rest or 4.8 percent was accounted for establishments with TE of less than 20.

Higher education industry, among industries recorded the highest gross addition to its fixed assets amounting to PHP8.2 billion or 63.3 percent of the total, followed by secondary/high school education industry with PHP3.8 billion or 29.1 percent.  Educational support services industry had the least gross addition to fixed assets with PHP3.7 million.

Other education services record the highest change in inventories

Change in inventories is defined as the value of ending less the beginning inventory.  Two industry groups posted positive change in inventories and these were other education services industry, with PHP530.2 million and pre-primary/pre-school education, with PHP339 thousand.

Subsidies reach PHP2.2 billion in 2014

Subsidies in 2014 reached PHP2.2 billion with the government providing grants to the industries of the services except for educational support services. Secondary/high school education industry received the highest grant amounting to PHP1.2 billion (55.8%).  Ranked second and third were higher education and primary/elementary education industries, with PHP417.2 million or 19.2 percent and PHP236.7 million or 10.9 percent, respectively. Other education services industry received the smallest portion of the grants amounting to PHP137.9 million (6.3%).

Sales from e-commerce amounts to PHP74.7 million

E-commerce refers to the selling of products or services over electronic system.  Transaction from e-commerce generated by education sector reached PHP74.7 million in 2014.  Only other education industry reported sales from e-commerce, accounting for 0.04 percent of the total income in 2014.

TECHNICAL NOTES

Introduction

This Special Release presents the preliminary results of the 2014 Annual Survey of Philippine Business and Industry (ASPBI) for the Educatiion sector, except public education services for all establishments in the formal sector of the economy.

The 2014 ASPBI is one of the designated statistical activities of the Philippine Statistics Authority (PSA). Data collected from the survey will provide information on the levels, structure, performance and trends of economic activities of the formal sector of the economy for year 2014. It will also serve as benchmark information in the measurement and comparison of national and regional economic growth.

The survey was conducted nationwide in April 2015 with the year 2014 as the reference period of data, except for employment which is as of November 15, 2014..

Data are presented at the national, regional and industry group or 3-digit 2009 Philippine Standard Industrial Classification (PSIC). .

Data collection was intensified through the use of web-based or online accomplishment of questionnaire through the PSA website and downloading of e-questionnaire and submission thru email..

Legal Authority

The conduct of the 2014 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 2014 ASPBI is a nationwide undertaking confined to the formal sector of the economy and as such excluded the informal sector.  The following comprise the formal sector:  

1.  Corporations and partnerships
2.  Cooperatives and foundations
3.  Single establishment with employment of 10 or more
4.  Single proprietorship with branches

Hence, the 2014 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).

The initial estimate of the 2014 LE shows that there are about 944,500 establishments in operation in the country for the year.  About 266,000 establishments (28% of the total establishments) belong to the Formal Sector of which 231,000 (87%) comprise the establishment frame.

Listed below are the 18 economic sectors within the scope of the 2014 ASPBI classified under the 2009 PSIC.

• 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 Work Activities (Q)
• Arts, Entertainment and Recreation (R)
• Other Service Activities (S)

Sampling Design

Unit of Enumeration

The unit of enumeration for the 2014 ASPBI is the establishment.  An establishment is defined as an economic unit, which engages, under a single ownership or control, in one or predominantly one kind of activity at a single fixed physical location.

Classification of Establishments

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

Economic Organization (EO) refers to the organizational structure or role of the establishment in the organization.  

Legal Organization (LO) refers to the legal form of the economic entity that provides the legal basis for ownership of the establishment. 

Industrial Classification is determined by the activity from which it derives its major income or revenue.  The 2009 PSIC which was approved for adoption by government agencies and instrumentalities through NSCB Resolution No. 2 Series 2010 was utilized to classify economic units according to their economic activities.

Size (SZ) of the Unit of Enumeration is determined by its total employment (TE) as of specific date.  Total employment (TE) refers to the total number of persons who work in or for the establishment. This includes paid employees, working owners, unpaid workers and all employees who work full-time or part-time including seasonal workers. Included also are persons on short term leave such as those on sick, vacation or annual leaves and on strike.

Geographic Classification is grouping of establishments by geographic area using the Philippine Standard Geographic Code (PSGC) classification. The PSGC contains the latest updates on the official number of regions, provinces, cities, municipalities, and barangays in the Philippines. The PSGC as of December 31, 2014 was used for the 2014 ASPBI.

Sampling Design

Selection of sample establishment for the 2014 ASPBI was done using stratified systematic sampling with 3-digit or 5-digit PSIC serving as industry strata and employment size as the second stratification variable.

Estimation Procedure

For Establishments with TE of Less Than 20

a. Non-Certainty Stratum

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

where:

where:

c.   Total Estimate for TE of 20 and Over  

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

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 (X_dp)  for the particular industry domain from all the regions.

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 establisments 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 selected industry domain with TE 20-99, the adjusted weight (W'_spj) was

where:

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

Questionaire Design

The questionnaire design is basically the same as that of the 2012 Census of Philippine Business and Industry. However, changes were made in the disaggregation of data items for fixed assets in support to the requirements of the 2008 Systems of National Accounts with respect to the generation of fixed capital formation.

The sample establishments responded also to the survey through the use of Web-based version of the 2014 ASPBI questionnaires which was accomplished online at the PSA website. Likewise, an e-questionnaire was also downloaded and submitted thru e-mail.

Response Rate

Field operations of the 2014 ASPBI were scheduled from April to July 2015.

Total response rate for Education sector, except public education services was 85.1 percent (1,177 out of 1,383 establishments).  This included receipts of "good" questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments.

Of the total responses, 27 establishments responded online.

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, 2014.

Paid employees are all full-time and part-time employees working in or for the establishment and receiving pay, as well as those working away from the establishment and paid by and under the control of the establishment.  Included also are all employees on sick or maternity leave, paid vacation or holiday and on strike.  Excluded are directors paid solely for their attendance at meetings, consultants, workers on indefinite leave, working owners who do not receive regular pay, home workers and workers receiving pure commissions only.

Unpaid workers are working owners who do not receive regular pay, apprentices and learners without regular pay and persons working for at least 1/3 of the working time normal to the establishment without regular pay.  Excluded are silent or inactive business partners.

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.

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 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 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.

Expense refers to cost incurred by the establishment during the year whether paid or payable.  This is treated on a consumed basis.  Valuation is at purchaser 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 Added is gross output less intermediate input. Computation of gross output for education sector is presented below.

Gross output (for Education sector) is equal to the sum of total income (less interest income, rent income from land, dividend income, royalty income and franchise income), capital expenditures of fixed assets produced on own account, and change in inventory.

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

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

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

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

E-Commerce refers to the selling of products or services over electronic systems such as the Internet Protocol-based networks and other computer networks, Electronic Data Interchange (EDI) network, or other on-line system.