Architectural and engineering activities and related consultancy industry dominates the sector
Preliminary results of the 2016 Annual Survey of Philippine Business and Industry (ASPBI) showed that a total of 808 establishments with total employment (TE) of 20 and over in the formal sector of the economy were engaged in Professional, Scientific and Technical Activities.
Among industries, architectural and engineering activities and related technical consultancy had the highest number of establishments with 178 or 22.0 percent of the total for the sector. Advertising closely followed with 154 establishments or 19.1 percent. Management consultancy activities ranked third with 124 establishments or 15.3 percent. Figure 1 shows the percentage distribution of establishments of the sector for establishments with TE of 20 and over by industry group in 2016.
Among regions, the National Capital Region (NCR) had the most number of establishments with 686 establishments or 84.9 percent of the total. CALABARZON and Central Visayas placed far second and third with 34 establishments (4.2%) and 33 establishments (4.1%), respectively.
Architectural and engineering activities and related technical consultancy industry employs the highest number of workers
Employment in 2016 reached a total of 112,865 workers. Almost all workers (99.9%) were paid employees and the rest were working owners or unpaid workers.
By industry group, architectural and engineering activities and related technical consultancy employed the largest number of workers with 27,613 or equivalent to 24.5 percent of the total employment of the sector. Management consultancy activities followed with 20,511 workers (18.2%) and advertising with 19,553 workers (17.3%). Figure 2 shows the distribution of employment of the sector for establishments with TE of 20 and over by industry group in 2016.
Across regions, NCR was the top employer which generated jobs for 91,567 workers (81.1%). This was followed by CALABARZON and Central Visayas with 10,716 workers (9.5%) and 6,067 workers (5.4%), respectively.
The average number of workers per establishment for the sector was recorded at 140. Research and experimental development in information technology posted the highest number of workers per establishment of 440.
Activities of head offices industry pays the highest average annual compensation
The sector paid a total compensation of PHP64.2 billion, equivalent to an average annual compensation of PHP569.1 thousand per employee in 2016.
Among the industries, activities of head offices paid the highest average annual compensation of PHP823.8 thousand per employee. Other industries paying an annual average compensation of more than six hundred thousand were the following:
- Management consultancy activities, PHP765.0 thousand per employee
- Architectural and engineering activities and related technical consultancy, PHP 627.8 thousand per employee
- Research and experimental development on natural sciences and engineering, 627.8 thousand per employee
- Accounting, bookkeeping and auditing activities; tax consultancy, 601.5 thousand per employee.
Figure 3 displays the average annual compensation of the sector for establishments with TE of 20 and over by industry group in 2016.
By region, NCR paid the highest average annual compensation of PHP614.7 thousand per employee while Western Visayas recorded the lowest average annual compensation per employee of PHP59.4 thousand.
Management consultancy activities industry contributes the biggest share in income and expense
In 2016, gross income generated by the sector reached PHP258.0 billion. Management consultancy activities had the biggest share of PHP73.2 billion or 28.4 percent of the total income for the sector.
At the regional level, NCR earned the highest income amounting to PHP221.5 billion or 85.9 percent of the total income. CALABARZON and Central Visayas followed with PHP26.1 billion (10.1%) and PHP5.1 billion (2.0%), respectively.
On the other hand, total expense incurred by the sector amounted to PHP199.4 billion in 2016. Activities of head offices had the biggest proportion in expense amounting to PHP53.5 billion or 26.9 percent. Figure 4 shows the income and expense for the top five industry groups of the sector for establishments with TE of 20 and over in 2016.
The top three regions in income were also the top regions in terms of expense. NCR, with total expense of PHP 173.0 billion (86.8%), incurred the highest expense among regions.
Income per peso expense stands at 1.29
In 2016, the income generated per expense by the sector for establishments with TE of 20 and over stood at 1.29.
Among industries, veterinary activities recorded the highest income per peso expense of 1.80. Other top industries in terms of income-expense ratio were as follows:
- Legal activities with 1.56 income per expense
- Management consultancy activities with 1.43 income per expense
- Activities of head offices with 1.35 income per expense.
By region, Davao Region recorded the highest income-expense ratio of 2.34.
Value added amounts to PHP160.4 billion
Value added for the Professional, Scientific and Technical Activities sector for establishments with TE of 20 and over was estimated at PHP160.4 billion in 2016.
The top three contributors to the total value added of the sector were the following:
- Activities of head offices with PHP44.4 billion (27.7%)
- Management consultancy activities with PHP43.5 billion (27.1%)
- Architectural and engineering activities and related technical consultancy with PHP27.9 billion (17.4%).
Value added per total employment, a measure of labor productivity, was estimated at PHP1,421.5 thousand per worker. Activities of head offices led the sector with labor productivity of PHP6,991.0 thousand per worker while research and experimental development on social sciences and humanities registered the lowest labor productivity of PHP314.7 thousand per worker. Figure 5 shows the distribution of labor productivity for Professional, Scientific and Technical Activities sector for establishments with TE of 20 and over by industry group in 2016.
Among regions, NCR posted the highest labor productivity amounting to PHP1,526.4 thousand per worker while Western Visayas recorded the least labor productivity of PHP116,135 per worker.
Gross addition to fixed assets reaches PHP4.4 billion; NCR reports the highest
Gross additions to fixed assets (capital expenditures less sale of fixed assets) acquired by the sector reached PHP4.4 billion in 2016.
By industry, activities of head offices acquired the highest gross additions to fixed assets at PHP1.1 billion or 25.2 percent of the total. Management consultancy activities followed closely with PHP1.0 billion while architectural and engineering activities and related technical consultancy placed third with PHP966.6 million.
Across regions, the top three in terms of gross additions to fixed assets comprised 94.17 percent of the total. NCR recorded the highest gross additions of PHP4.0 billion (89.4%) followed by CALABARZON with PHP166.2 million (3.8%) and Davao Region with PHP43.2 million (1.0%).
Total change in inventories amounts to PHP156.0 million
Total change in inventories (ending less beginning inventory) for establishments with TE of 20 and over was estimated at PHP156.0 million in 2016.
Three industry groups generated more than PHP20.0 million worth of change in inventories, and these were the following:
- Activities of head offices, PHP56.6 million
- Architectural and engineering activities and related technical consultancy, PHP48.0 million
- Technical testing and analysis, PHP24.2 million
Among regions, NCR led all regions in terms of change in inventories worth PHP123.2 million or 79.0 percent share to total.
Activities of head office receives PHP61.1 million subsidy
Subsidies are special grants received from the government in the form of financial assistance or tax exemption or tax privilege to aid and develop an industry. Activities of head offices located in Ilocos Region was the only industry group that received subsidy worth PHP61.1 million in 2016.
This Special Release presents the preliminary results of the 2016 Annual Survey of Philippine Business and Industry (ASPBI) for Professional, Scientific and Technical Activities sector for establishments with total employment (TE) of 20 and over.
The 2016 ASPBI is one of the designated statistical activities of the Philippine Statistics Authority (PSA). 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 2016.
The survey was conducted nationwide in 2017 with the year 2016 as the reference period, except for employment where in the reference period is 15 November 2016.
Establishment Data Management System (EDMS) was utilized in the decentralized processing of 2016 ASPBI questionnaires in the provinces as well as the online accomplishment of questionnaire through the PSA website.
Data are presented by industry group or 3-digit 2009 Philippine Standard Industrial Classification (PSIC) at the national and regional level.
The conduct of the 2016 ASPBI is authorized under Republic Act 10625 known as the Philippine Statistical Act of 2013, which mandates reorganizing and strengthening of the Philippine Statistical System (PSS), its agencies and instrumentalities.
Scope and Coverage
The 2016 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 partnerships
- Cooperatives and foundations
- Single proprietorship with employment of 10 and over
- Single proprietorship with branches
Hence, the 2016 ASPBI covered only the following economic units:
- All establishments with 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 2016 ASPBI was extracted from the 2016 List of Establishments (LE). The estimated number of establishments in operation in the country in 2016 totaled to 902,213. About 294,494 establishments (32.6% of the total establishments) belong to the formal sector of which 255,403 (86.7%) 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 2016 ASPBI is the establishment. An 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.
Taxonomy 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.
Industrial Classification of an economic unit was 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 PSA Resolution No. 01 Series of 2017-158 signed on 14 February 2017 was utilized to classify economic units according to their economic activities.
Size of an establishment is determined by its total employment (TE) as of specific date. 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 refers to the 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 31 December 2016 was used for the 2016 ASPBI.
The 2016 ASPBI uses a stratified systematic sampling with 3-digit or 5-digit PSIC serving as industry strata, and employment size as the second stratification variable.
For establishments with TE of 20 and over, the 18 administrative regions serve as the geographic domains while the 5-digit level of the 2009 PSIC serves as the industry domains.
Estimation Procedure for Establishments with TE of 20 and Over
a. Non-Certainty Stratum (strata of TE 20 to 49 and TE 50 to 99)
Sections A, C, E, F, G, H, I, J, K, L, M, N, P, Q, R and S.
The estimate of the total of a characteristic for the non-certainty employment strata in TE of 20 and over for an industry domain in each region
s = denotes the non-certainty employment strata in TE of 20 to over
p = 1, 2,..., 18 regions (geographic domains)
Xspj = value of the jthestablishment in the non-certainty employment strata in TE of 20 and over for an industry domain in each region
j = 1,2,3,..., nsp establishments
Wspj = weight of the jth establishment in the non-certainty employment strata in TE of 20 and over for an industry domain in each region
Nsp = total number of establishments in the non-certainty employment strata in TE of 20 and over for an industry domain in each region
nsp = number of sample establishments in the non-certainty employment strata in TE of 20 and over for an industry domain in each region
b. Certainty Stratum (Establishments under the following: Section B and D, ICT core industries, BPM industries, GOCC's and with TE 100 and over)
c = denotes the certainty employment strata in TE of 20 and over
p = 1,2,...18 regions (geographic domains)
Xcpj = value of the jthestablishment in the certainty employment strata in TE of 20 and over for an industry domain within each region
j = 1,2,3,..., mcp establishments
mcp = number of establishments in the certainty employment strata in TE of 20 and over in an industry domain within each region
c. Total Estimate for TE of 20 and Over
The estimate of the total of a characteristic for the industry domain in each region (geopraphic 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 domain in each region
National level estimate of the characteristics by industry domain were obtained by aggregating separately the estimates for the particular industry domain from all the regions.
Weight Adjusment Factor for Non-Response
To account for non-response in the non-certainty strata, the adjusment factors, and (n/n') was multipled with the sampling weight (W) of each of the sampling unit. The sampling weight, which is defined as N/n was recomputed as
Thus, the adjusted weight (W'spj) for the non-certainty employment stratum for the industry domain with TE 20-99 was
Nsp = 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 of 20-99 for the industry domain within each geographic domain (region)
Response rate for Professional, Scientific and Technical Activities sector for establishments with TE of 20 and over was 89.8 percent (405 out of 451 establishments). This included receipts of "good" questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments.
Of the total responses, four establishments responded online.
Reports of the remaining non-reporting establishments were taken from other available administrative data sources and financial statements from Securities and Exchange Commission (SEC). However, there were establishments which were found to be duplicates, out-of-scope and out of business in 2016.
Limitation of Data
Only the formal sector was covered in the survey.
Concepts and Definitions of Terms
Establishment is an economic unit under a single ownership and control, i. e. under a single entity, engaged in one or predominantly one kind of economic activity at a single fixed location.
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 for the establishment as of 15 November 2016.
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. Valuation is at producer prices (ex-establishment) net of discounts and allowances, including duties and taxes but excluding subsidies.
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 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. Gross output for Professional, Scientific and Technical Activities sector is the sum of the 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 inventories. Intermediate input is equal to the sum of the following expense items: materials and supplies purchased; fuels, lubricants, oils and greases purchased; electricity purchased, water purchased; industrial services done by others; non-industrial services done by others (less rent expense for land); goods purchased for resale; research and development expense; environmental protection expense; royalty fee; franchise fee; and other expense.
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.
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.
See more at the Annual Survey of Philippine Business and Industry (ASPBI) page.