February 2017, Unemployment Rate Falls to 5.33%

The Central Statistics Agency (BPS) released figures showing that open unemployment reached 7.01 million people, or 5.33 percent, in February 2017. This figure decreased by 0.17 percent compared to the same period last year. The decrease is mainly due to a sharp decline in rural unemployment. Furthermore, BPS explained that the open unemployment rate (OUR) in rural areas fell significantly from 4.35 percent in February 2016 to 4 percent in February 2017. Meanwhile, the OUR in urban areas only decreased slightly from 6.53 percent to 6.5 percent.

The significant drop in rural unemployment is attributed to absorption by the agricultural sector. The main cause is the bumper harvest that occurred in the first quarter of this year. Last year, the bumper harvest only occurred in the second quarter. The increased labor absorption in the agricultural sector has resulted in increased female labor force participation. This is because women also help with harvesting during the bumper harvest.

In terms of working hours, 87 million worked full-time; 28 million worked part-time; and 9.5 million were underemployed. The largest workforce is in the agricultural sector, reaching 39.68 million in February 2017, an increase from 38.29 million in February 2016.