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Mining for Decent Work: �Bridging the Gap Between Wealth and Welfare

27 November 2025 (Thursday), 1:00 – 3:30 PM

Department of Finance, Roxas Blvd., City of Manila

Good afternoon to everyone!

Again, Welcome to the Philippine 2025 Extractives Transparency Week, on its 3^rd Day!

In this session, our topic is entitled, “Mining for Decent Work: Bridging the Gap between Wealth and welfare.”, which is a very complex and somehow, a sensitive one.

In this session, we will lay the foundation and contrast the mining sector’s significant fiscal contribution against its limited capacity to generate mass employment, … that is, setting the stage for a discussion on job quality rather than just quantity.

In the local context, while the mining industry is a pillar of the Philippine export economy, it is capital-intensive rather than labor-intensive. However, the data reveals a stark disconnect: billions in value are extracted, yet less than 1% of the workforce is employed in the sector.

This necessitates a shift on how we evaluate the industry's social license. If mining cannot provide mass employment, it is morally and economically imperative that the jobs it does provide are of the highest quality—safe, secure, and well-compensated.

This slide frames the entire presentation around the quality of "Decent Work" rather than just economic statistics.

Imagine we are entering a mining tunnel. Are we ready to face our fears? Let’s dive in.

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The Macro Context: �A Wealth-Work Paradox

Fiscal Heavyweight	The Philippine minerals industry is a significant economic driver, with exports valued at US$ 7.38 Billion in 2024 and metallic mineral production value reaching PhP 316.3 Billion or US$1.6B. (2024 MGB Data)
Employment Lightweight	Despite high revenues, the sector employs approximately 291,672 workers (2024 MGB Data), representing a minute fraction of the national workforce.

Source:

Mines and Geosciences Bureau: Mining industry Statistics CY 2022 to S1-2025 released 22 August 2025, accessed November 21, 2025, http://databaseportal.mgb.gov.ph/mgb-public/api/attachments/download?key=xi8pJ5CEPhaZ3XgUvOAqqaKZVjEPn7WT7d7z27OSuLD7JF7GLIdzBp1CR99zU2DW

A word of caution, this figures will trigger many, if not all of us.

The Philippine minerals industry is a significant economic driver, with exports valued at US$ 7.38 Billion in 2024 and metallic mineral production value reaching PhP 316.3 Billion.

Sound huge? Think again.

This is only 3.18% of the GDP for 2024, and the average growth rate is only at 4.5% within the larger extractives sector.

Despite seemingly high revenues, the sector employs approximately 291,672 workers as 2024 data, representing a minute fraction of the national workforce of 0.6%.
However, it means that each mining worker produces $46,970.57 or roughly a staggering PhP2.3M per capita. Yes, each mine worker contributed PhP2.3M to the national economy in 2024.

We see a "Wealth-Work Paradox" where high financial returns for the state do not automatically translate into broad-based employment. This concept serves as the analytical anchor for understanding the industry's socio-economic footprint. It describes the inverse relationship between the sector's high financial output and its low labor absorption. Data from 2024 elucidates this paradox with clarity.

Now, this data challenges the traditional narrative used to justify mining operations. Historically, the promise of mass job creation has been the primary argument for granting the social license to operate. However, modern large-scale mining is inherently capital-intensive - relies on automation, heavy machinery, and specialized technology rather than manual labor.

Calling the attention of our economic managers. This issue needs great attention.

****

2024 GDP - $461.62B / $7.38B + $6.32B or 3.18% of the GDP, and average growth rate is only at 4.5% for the larger extractives industries.

2024 Employed – 48.487M / 291,672 or 0.6% of the number of persons employed in 2024

Each mining worker produces or contributes $46,970.57 or roughly PhP2.3M.

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The Macro Context: �A Wealth-Work Paradox

The Paradox	We see a "Wealth-Work Paradox" where high financial returns for the state do not automatically translate into broad-based employment.
The 2025 Shift	The challenge for PH-EITI is moving from "Fiscal Transparency" (tracking taxes) to "Human Transparency" (tracking decent work deficits).

Now, the challenge for PH-EITI is moving from "Fiscal Transparency" or tracking taxes to "Human Transparency" or tracking decent work deficits.

For the past decade, the Extractive Industries Transparency Initiative or EITI has focused primarily on "Fiscal Transparency"—the reconciliation of company payments and government revenues to prevent corruption.

While vital, this narrow focus is no longer sufficient to address the social deficits of the sector.

The 2025 Extractives Transparency Week marks a strategic pivot toward "Human Transparency."

This new paradigm seeks to track "decent work deficits" with the same rigor used to track tax payments.

It acknowledges that a mine can be fully compliant with tax laws while simultaneously engaging in exploitative labor practices.

By integrating decent work indicators into EITI reporting, stakeholders aim to illuminate the human costs of extraction.

To the Philippine EITI, us from the BLGF, and the MSG. Let’s take on this challenge.

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The Crisis of Security of Tenure ("Endo")

Legal Conflict	The Labor Code of the Philippines guarantees security of tenure, yet the industry relies heavily on "project employment" to keep workers on short-term contracts.
Judicial Precedent:	Supreme Court rulings established that workers performing core functions are regular employees by law, regardless of their contract titles.

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The Crisis of Security of Tenure ("Endo")

The "5-5-5" Scheme	Contractualization (or "Endo") remains pervasive, often shielding principal companies from liability and preventing workers from joining unions or accessing social benefits.
Policy Gap	There is an urgent need to harmonize the investment-centric Philippine Mining Act with the protectionist mandates of the Labor Code.

Source: Institute for Labor Studies: Examining the “5-5-5” Arrangement in Contractualization: A Study on the Repeated Hiring Practices of Firms in Selected Industries, accessed November 21, 2025, https://ils.dole.gov.ph/policy-brief/2015-policy-briefs/examining-the-5-5-5-arrangement-in-contractualization-a-study-on-the-repeated-hiring-practices-of-firms-in-selected-industries

The Labor Code of the Philippines guarantees security of tenure, yet the industry relies heavily on "project employment" to keep workers on short-term contracts. Under the Labor Code of the Philippines, an employee who performs activities "usually necessary or desirable in the usual business or trade of the employer" is considered a regular employee. Regular employees are entitled to security of tenure, meaning they cannot be dismissed without just cause and due process. They are also entitled to a suite of benefits, including service incentive leave, 13th-month pay, and separation pay.

This labor crisis is exacerbated by a fundamental policy gap: the lack of harmonization between the Philippine Mining Act and the Labor Code.

The Philippine Mining Act or RA 7942: is Designed to attract foreign and domestic investment, this law emphasizes operational flexibility and fiscal incentives. It encourages the outsourcing of specialized activities to maximize efficiency and reduce capital exposure.

While The Labor Code of the Philippines, PD 442: is predicated on social justice.

This law seeks to protect labor as a primary social economic force. It mandates security of tenure and restricts "labor-only contracting.”

In practice, the investment-centric provisions of the Mining Act often supersede the protectionist mandates of the Labor Code within the operational enclaves of mine sites. Mining firms classify workers as "project-based," arguing that their employment is coterminous with a specific phase of mining, say, exploration or site development.

While legitimate in some contexts, this classification is frequently abused to cover workers performing continuous, core functions such as hauling, drilling, and ore processing.

May I remind you what the Supreme Court said, if a worker operates a drill in a mine, and the business of the company is mining, that worker is performing a core function. Regardless of whether their contract says "Project Employee" or "Fixed Term," the law views them as regular.

The burden on the persistence of "Endo" in the face of this ruling represents a failure of governance and enforcement.

To our legislators, policy formulators and implementers, and oversight agencies, let’s get our acts together to resolve this conflict.

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Occupational Safety and Health: Visible and Invisible Risks

Shifting Risk Profile	Workers can be exposed to harmful substances. Even in large-scale mining, where OSH management systems are in place, the widespread use of subcontracting can undermine compliance and leave agency-supplied workers especially vulnerable.
The "Invisible" Workforce:	There is an urgent need to harmonize the investment-centric Philippine Mining Act with the protectionist mandates of the Labor Code.

Source: Improving workers' rights in the rural sectors of the Philippines - International Labour Organization, accessed November 21, 2025, https://www.ilo.org/sites/default/files/2025-09/Improving%20workers%27%20rights%20in%20the%20rural%20sectors%20of%20the%20Philippines.pdf

In the mining sector, especially in informal small-scale operations, in addition to the high incident rate of accidents, workers can be exposed to harmful substances. Even in large-scale mining, where Occupational Safety and Health management systems are in place, the widespread use of subcontracting can undermine compliance and leave agency-supplied workers especially vulnerable.

We know for a fact that mining is inherently hazardous, the risk profile in the Philippines is evolving beyond the traditional dangers of rockfalls, cave-ins, and heavy equipment accidents.

Remember the miner rescued from a tunnel of a collapsed gold mine in Pantukan Town, Davao De Oro, after the first 2 powerful earthquakes that struck off the southern Philippines last month?

Now, the rise of nickel laterite mining introduces specific risks related to dust inhalation, chemical exposure during leaching processes, and environmental hazards that can trigger landslides.

Accidents involving subcontractors often go underreported because they are not always captured in the principal company's safety statistics submitted to the Mines and Geosciences Bureau. This practice of reporting or not reporting, creates a dangerous distortion in safety data, referred to as the "Invisible Workforce" phenomenon.

Although, Principal mining companies are required to report safety statistics, such as Lost Time Injuries (LTI) and Non-Lost Time Injuries (NLTI), to the Mines and Geosciences Bureau. However, accidents involving workers hired by subcontractors are often recorded separately—or not at all—in the principal's primary safety report.

This allows large, multinational mining firms to present "Clean Safety Records" to investors and the public, boasting of millions of man-hours without any Lost Time Injuries. Meanwhile, the high-risk tasks such as blasting, and underground drilling, are performed by agency workers whose accident records remain hidden in the separate files of the subcontractor.

True transparency requires "whole-of-site" safety reporting, mandating that the safety of every person entering the mine gate is the responsibility and statistical burden of the license holder.

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Occupational Safety and Health:

Visible and Invisible Risks

Enforcement Gaps	A fragmented regulatory environment between DOLE (Labor Standards) and MGB (Mine Safety) often leads to underreporting of accidents, particularly those involving subcontractors who are not fully captured in principal company reports.
Call to Action	We need a unified, digital incident reporting system that covers all workers on-site, regardless of employment status.

Sad to say, a fragmented regulatory environment between the Department of Labor and Employment, which enforces Labor Standards, and the Mines and Geosciences Bureau on Mine Safety, often leads to underreporting of accidents, particularly those involving subcontractors who are not fully captured in principal company reports…

…

While physical safety dominates the discussion, the "Decent Work" framework also encompasses mental well-being.

The isolation of remote mining camps, combined with the job insecurity inherent in "Endo" arrangements, creates significant psychosocial stressors.
Workers who do not know if they will have a job in five months are under constant stress, which can lead to fatigue, distraction, and ultimately, physical accidents. A holistic Occupational Safety and Health strategy must address the psychological toll of precarious employment, especially in the extractives sector.

We need a unified, digital incident reporting system that covers all workers on-site, regardless of employment status. Be it permanent, contractual, or third-party agency contracted workers.�

Calling our DOLE, MGB, and Occupational Safety and health regulators, and also the PH EITI and MSG on this issue.

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Gender & Inclusivity: �Beyond the Headcount

Participation Data	2022 data reveals significant variations in gender representation across both sectors and organizational roles.
The Wage Gap	Structural barriers and occupational segregation lead to significant wage disparities, as women are often excluded from higher-paying technical and hazardous duty roles.

Source: FY 2022 PH-EITI Report - Contextual Information Chapter, accessed 24 November 2025, https://pheiti.dof.gov.ph/download/10th-ph-eiti-country-report_contextual-information/?wpdmdl=6718&refresh=6767049e0f8e31734804638

On gender and inclusivity, 2022 data reveals significant variations in gender representation across sectors and organizational roles.

In terms of organizational roles, higher positions show better gender balance, with executive, managerial, and supervisory positions having approximately three males for every female employee. However, the gender gap widens considerably at the rank-and-file level, where the ratio increases to 10 males for every female employee.
This pattern suggests that while women who enter the extractive industries have opportunities for career advancement to leadership positions, significant barriers may exist for initial entry into the industry, particularly at operational levels. The disparity is most pronounced in the metallic mining sector, which employs the largest workforce but maintains the highest gender gap among the three sectors.

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Gender & Inclusivity: �Beyond the Headcount

Participation Data	2022 data reveals significant variations in gender representation across both sectors and organizational roles.
The Wage Gap	Structural barriers and occupational segregation lead to significant wage disparities, as women are often excluded from higher-paying technical and hazardous duty roles.

The problem is not just the number of women, but where they are located within the organizational hierarchy. The industry exhibits dual forms of segregation: (1) Horizontal Segregation; and (2) Vertical Segregation.
Horizontal Segregation: Women are funneled into specific, lower-valued occupational categories. They dominate administrative, clerical, and service roles (e.g., camp administration, catering, cleaning), while men monopolize the technical, operational, and extraction roles.
Vertical Segregation: Even within the administrative silos where they are present, women are rarely found in senior decision-making roles. The "glass ceiling" remains robust, with boards and executive committees remaining overwhelmingly male.

Gender inclusivity in mining is often treated as a box-ticking exercise. However, having 11% female employment is meaningless if those women are stuck in low-wage, low-agency positions. The new EITI Standard forces us to look deeper. We need to analyze the "vertical" segregation (or the lack of women in management) and "horizontal" segregation (or the women restricted to admin roles). Furthermore, we must acknowledge the informal role of women in small-scale mining, where they are often invisible to the legal system yet essential to the supply chain.

The 2023 Standard now mandates granular, gender-disaggregated data. We must measure not just how many women are hired, but their rank, pay, and retention rates.

This requirement moves the industry beyond voluntary CSR reports. It compels companies to provide granular data that reveals the vertical and horizontal segregation being discussed. By making this data public, the PH-EITI empowers civil society and labor unions to hold companies accountable for their diversity commitments. It transforms "gender equality" from a slogan into a measurable, trackable performance indicator.

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Social Expenditures: �From Charity to Sustainability

The Funding Pool	As of mid-2025, the industry has committed approximately PhP 36.61 Billion for Social Development and Management Programs (SDMP).
The Challenge	Are these funds creating decent work? Often, SDMP funds short-term infrastructure (basketball courts, waiting sheds) rather than sustainable livelihoods.

Source: MGB Data, accessed November 21, 2025, https://mgb.gov.ph/attachments/article/1654/Metallic%20production%20continues%20to%20drive%20growth.pdf

As of mid-2025, the industry has committed approximately PhP 36.61 Billion for Social Development and Management Programs (SDMP).

The Philippine Mining Act requires companies to allocate a minimum of 1.5% of their operating costs to the Social Development and Management Program (SDMP). This has resulted in a massive accumulation of funds dedicated to community development. As of mid-2025, the industry has committed approximately PhP 36.61 Billion for SDMP initiatives.
This financial reservoir theoretically positions the mining industry as a primary driver of rural development. However, the outcomes often fail to match the magnitude of the investment. Many host communities remain trapped in poverty, dependent on the mine for their economic survival.

We come to ask, are these funds creating decent work? Often, SDMP funds short-term infrastructure such as basketball courts and waiting sheds rather than sustainable livelihoods.

SDMP funds are currently utilized as "Corporate Social Responsibility (CSR) handouts" rather than strategic economic investments.
Common SDMP projects also include short-term medical missions.
While these projects garner political goodwill and social license in the short term, they fail to create sustainable livelihoods. A basketball court does not generate income when the mine closes. This "charity model" creates a culture of dependency, where the community relies on the mining company for basic services that should be provided by the state, or for economic injections that cease once the ore is depleted.

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Social Expenditures: �From Charity to Sustainability

Strategic Shift	SDMP funds should be reallocated to support Just Transition initiatives—specifically retraining workers and diversifying local economies for the post-mining era.
PH-EITI Role	PH-EITI reports must track the impact of these funds on local employment rates, not just the amount spent.

Social Development and Management Program (SDMP) funds should be reallocated to support Just Transition initiatives—specifically retraining workers and diversifying local economies for the post-mining era.

As the world moves toward a clean energy future, the mining sector must embrace the framework of a "Just Transition." This concept acknowledges that mineral resources are finite and that the transition to a green economy must not leave host communities behind and the environment destroyed.
The PhP 36.61 billion should be "weaponized" to create independent local economies that can survive the inevitable closure of the mine.

As to PH-EITI, its reports must track the impact of these funds on local employment rates, not just the amount spent. As the world demands more nickel for electric vehicles, the Philippines must ensure that the workers extracting these critical minerals are protected by world-class labor standards.

EITI Requirement 6.1 mandates the disclosure of social and environmental expenditures. However, the 2025 vision for PH-EITI pushes for an evolution in reporting. It is no longer sufficient to report how much was spent. The reporting must track the impact of that spending.
Did the PhP 36 billion reduce the poverty incidence in the host municipality? Did it increase the number of college graduates? Did it spawn new businesses? By shifting the metric from "input-based" to "outcome-based", the EITI can drive the strategic realignment of social funds toward the Just Transition.
As the world demands more nickel for electric vehicles, the Philippines must ensure that the workers extracting these critical minerals are protected by world-class labor standards.

The Philippine-EITI platform is the ideal venue to monitor and enforce this transition.

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A Just Transition requires that the minerals powering the future are not extracted using the labor practices of the past.