Manpower Cooperative vs. Agency: Which Delivers Better Workforce Stability?

For companies in industries such as construction, manufacturing, janitorial services, solar farms, fast food restaurants, retail & merchandising, aviation, logistics, warehousing, and agribusiness, choosing the right workforce partner is critical. Two common options are manpower cooperatives and manpower agencies—but which of the two delivers better value, compliance, and long-term results

What is a Manpower Cooperative?
A manpower cooperative is a worker-owned organization that supplies labor to client companies. Unlike in manpower agencies, members of a cooperative are both employees and owners.
Advantages: 

• Stronger Retention – Members enjoy stable employment and cooperative benefits such as Government Mandated Benefits, Members’ Savings and Benefit Program, Members’ Financial Program, In-house Medical Benefits and High-yield Investments opportunities for members. 
• Employee welfare – Members receive dividends, patronage refunds, and social benefit asides from wages.
• Employee Motivation – Because workers are also owners, they care more about their performance and the success of both the client and the cooperative.

This makes manpower cooperatives ideal for HR teams focused long-term benefits such as cost efficiency, workforce stability, and compliance.

What is a Manpower Agency?
Manpower agencies are profit-driven businesses that hire and deploy workers for client companies. While they provide quick hiring for urgent or short-term needs, they come with limitations:

• Higher Costs – Added profit margins increase labor expenses around 20-30%.
• Short-Term Contracts –Workers are usually hired under fixed-term or project-based arrangements, which often provide limited statutory benefits such as SSS, PhilHealth, and Pag-IBIG, and rarely include extras like health insurance or retirement plans. This leads to dissatisfaction and low morale.

Agencies are best for companies with urgent or short-term manpower needs.