This discussion paper evaluates key macroeconomic variables within the context of the Sahm Rule to determine whether the Philippines entered a recession in 2025. Results vary across methodological choices: unadjusted data yields five months of formal breach, while seasonally adjusted specifications yield between one and nine months, depending on baseline selection. Despite these differences, all outcomes indicate substantial labor market stress, with employment contracting by 1.76 million workers on average during Sahm-signal months in which the labor force declined or stagnated, and youth unemployment peaking at 3.2 percentage points year-on-year. Viewed in conjunction with the appreciable slowdown of the Philippine economy in the third quarter, evidence suggests that the Philippines entered a “growth recession” in the latter half of 2025. Further analysis indicates that the contraction of employment, rather than an expansion in the labor force, drove the sustained rise in unemployment. To address these challenges, this paper recommends pursuing fiscal consolidation to restore fiscal space and minimize crowding out, reevaluating and reinvigorating industrial policy through enhanced public-private partnerships, reducing regulatory and tax burdens, and reviewing the minimum wage-setting framework to mitigate its attendant disemployment effects.