Sergio Ortiz-Luis Jr., president of the Employers Confederation of the Philippines, Frank Carbon, vice president in the Visayas of the Philippine Chamber of Commerce and Industry, and Joey Concepcion, Presidential Adviser for Entrepreneurship, all declared that employers will be hit by the pay increases. Last Friday, the Western Visayas regional wage board hiked the minimum wage by P55 to P110. Likewise, the NCR wage board announced a P33 increase, thus raising the minimum wage in Metro Manila to P570. PM had earlier called for a P100 legislated wage hike.
“Pera na magiging bato pa [1]. This is what will happen if the employers’ demand for exemption or deferment is granted. The wage hikes are not even enough to recover the value lost to inflation for the past three years. Deferring the pay increase and exempting employers will be rubbing salt on the wound,” declared Rene Magtubo, PM national chair.
He added that “Doomsday scenarios of firms going bankrupt, laying off workers and inflation running amok are just the usual disinformation and scare tactics of employers in their class war against a wage increase and a profit decrease. Studies have shown that the employment and inflation effects of wage increases in developing countries are marginal. Employers are being disingenuous in saying that salary hikes will just induce price increases but they are silent on the fact that wages have already been eroded by inflation. Workers are the victims of inflation and wage hikes are not its cause.”
The group insisted that the pandemic-induced economic crisis is not an argument against a wage hike. “On the contrary, it is a reason to provide money to consumers through a pay increase. Boosting the purchasing power of consumers—especially lowly paid workers who spend most of their take-home pay compared to high income earners—will pump prime the economy and lead to the revival of MSMEs.”
PM pointed out that a MSME with 10 workers, will only incur an additional P330 in daily wage costs or P8,580 in monthly labor expenses which translates to a mere 0.3% of its P3 million asset size. “This will definitely not bankrupt an MSME. But a lack of market because of low consumption will kill an MSME. A wage hike will create a virtuous cycle in the economy. Capitalists simply do not want to share the profit they have accumulated through the decade and a half of sustained economic growth,” Magtubo expounded.
May 18, 2022
Partido Manggagawa (PM)