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Wage hike decision vital in spurring economic recovery


Ten petitions for wage increases have been filed in six regional wage boards according to a report this week of the Department of Labor and Employment’s National Wage and Productivity Commission (NPWC). The petitions have been filed in the National Capital Region – NCR, Region 3 – Central Luzon, Region 4A – Calabarzon, Region 6 – Western Visayas, Region 7 – Central Visayas), and Region 8 – Eastern Visayas.

There are some 3.6 million minimum wage earners in the country, receiving P537 a day. The petitioners are asking that the minimum wage be raised to at least P750 a day. Asked whether a petition will be granted, the NPWC head said the wage boards recognized the urgency of increasing the salary of the workers.

The last adjustment in minimum wage was in 2018. The country’s inflation rate in 2019 was 2.48 percent, or a 2.73 percent decline from 2018. In 2020, the inflation rate was 2.64 percent or a 0.15 percent increase from 2019. The wage boards are expected to factor in these rates as the erosion of the peso’s purchasing power puts pressure on the family budget.

During the last two years of the coronavirus pandemic, families of minimum wage earners have suffered myriad difficulties. Periodic episodes of joblessness due to quarantine restrictions gave rise, too, to higher incidence of involuntary hunger among the neediest families.

Cost of living has long been a contentious issue whenever this is brought into the discussion of a “living wage”. According to a 2019 report of the Philippine Statistics Authority (PSA), a family of five needs at least P10,841 a month to meet their most basic food and non-food needs.

Last week, the Trade Union Congress of the Philippines (TUCP) filed a wage petition asking for a PHP470 increase in the daily minimum wage in NCR. This is almost 13 times the latest P37 increase granted in 2018.

While acknowledging the need for reviewing the minimum wage in light of the continuing rise in fuel and food prices, the Employers Confederation of the Philippines (ECOP) has warned that micro enterprises — that account for 65 percent of its members and 90 percent of businesses in the country — would be hard-pressed coping with a minimum wage increase. This is gleaned from the difficulties encountered in complying the required 13th month pay during the past two years of the pandemic.

In theory, higher wages could motivate workers to become more industrious, thereby increasing productivity and enabling their employers to produce better products or render improved services. In the Philippines, however, discussions on possible productivity increases are hardly considered when wage increase petitions are tackled by the wage boards.

Regardless of the eventual decision of the wage boards, the need to improve the quality of life of 26.14 million Filipinos still living below the poverty threshold — and address the multiple pain points inflicted by the Covid-19 pandemic — have become priority concerns.

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