PH 'Misery Index' Shoots to 20.3% — Highest in Nearly 2 Years as Inflation and Underemployment Bite

The Philippines' adjusted misery index skyrocketed to 20.3% in January 2026 — the highest level in nearly two years and a massive jump from December 2025's 13.8%. The last time the index was this bad was July 2024, when it hit 20.7%. In other words, Filipino households haven't felt this much economic pain in a long time.

What exactly is the misery index? Originally developed by economist Arthur Okun, it combines unemployment and inflation rates to gauge how much economic distress the average person is feeling. The Philippine version now also factors in adjusted underemployment — giving a more complete picture of the pain on the ground.

Two forces drove the index up sharply: inflation accelerated to an 11-month high of 2% in January, while underemployment — meaning people who have jobs but want more hours or better pay — climbed to a six-month high of 13.2%. Combined with rising fuel costs and a weakening peso, the picture for ordinary Filipinos is getting increasingly grim.

The timing couldn't be worse. With the Iran conflict pushing global oil prices through the roof and the peso teetering near the P60-per-dollar level, the cost of basic goods — from rice to transportation — is climbing fast. The misery index essentially confirms what millions of Filipinos already feel every time they go to the palengke or fill up their gas tanks.

A lower misery index typically signals better economic health, but experts warn that structural issues like underemployment tend to persist even when headline numbers improve. For now, the 20.3% reading is a loud warning bell: economic relief isn't coming anytime soon for the average Filipino household.

Source: BusinessWorld Online