The spatial mismatch hypothesis states that low access to potential employers or firms is associated with lower employment levels in a region, and that the distribution of these potential jobs and employment levels are not evenly distributed across space. This study aims to test this hypothesis in the context of the Philippines, where a trend of unbalanced regional development is becoming more and more apparent. The results reveal that access to firms has a positive significant effect on employment levels even when controlling for other location and working-age population characteristics. Moreover, the results also show that high-employment and high-access communities are significantly clustered in Manila, to the disadvantage of its neighboring provinces. These findings suggest that access to potential employers is a significant contributor to a region’s employment levels and that initiatives aimed at solving the unemployment problem should give more focus on job creation near underserved workers’ locations.

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