Marcos: Wage increase soon

PRESIDENT Ferdinand Marcos Jr. has said that an increase in the minimum wage in the country may be implemented soon to alleviate inflationary pressures on workers.

This development was relayed by Marcos to International Labour Organization (ILO) Director General Gilbert F. Houngbo who paid him a courtesy visit at Malacañan on Tuesday, June 27, 2023, the Presidential Communications Office (PCO) reported.

The President said the Department of Labor and Employment (Dole) had engaged in discussions with workers and labor unions regarding this matter.

“I think our negotiations with workers, with the unions, with the different negotiations, we will be able to come to a good working number, a good compromise,” Marcos said.

Resolving the issue

Dole Secretary Bienvenido Laguesma, who was also present during the meeting with the ILO chief, mentioned that they might be able to resolve the wage increase issue within the week.

Laguesma echoed the President’s comments by highlighting that majority of businesses in the Philippines fall into the micro and small categories. Micro businesses employ only one to nine workers, while small businesses employ 10 to 99 workers.

Laguesma also said that they will present the Philippine Development Plan (PDP) 2023-2028, which has been endorsed by both the labor sector and Dole, to the President and the Cabinet before organizing a national tripartite conference. The PDP 2023-2028 is a plan for deep economic and social transformation to reinvigorate job creation and accelerate poverty reduction by steering the economy back on a high-growth path, according to the National Economic Development Agency.

According to the PCO, the current minimum wage in the Philippines ranges between P372 and P470, depending on the region where the business is located.

Calls

However, the PCO report does not provide specific details on the wage increase, including whether it will be enacted through legislation or the Regional Tripartite Wages and Productivity Board in each of the 17 regions.

Labor groups have been calling for a wage increase, and some lawmakers have introduced bills supporting their cause.

One such measure is Senate Bill 2002, filed by Senate President Juan Miguel Zubiri. The bill (the Across-the-Board Wage Increase Act of 2023) proposes a P150 daily across-the-board wage hike for employees in the private sector, regardless of agricultural or non-agricultural nature, capitalization and number of employees.

Earlier this month, fifteen business organizations in the Visayas jointly issued a statement opposing the legislation, citing potential harm to micro, small and medium enterprises (MSMEs) still recovering from the effects of the Covid-19 pandemic. They also expressed concerns about wage rate disparities across regions and possible discouragement of investors if the bill becomes a law.

The progressive labor group, Alyansa sa mga Mamumuo sa Sugbo-Kilusang Mayo Uno, disputed the business groups’ position, arguing that the P150 across-the-board wage increase would not significantly impact larger businesses. They referred to a study conducted by the non-profit research group IBON Foundation, which analyzed the effects of a P170 wage hike on various industries.

According to the IBON Foundation study, only micro-businesses with fewer than 10 employees would be significantly affected, and they would require government subsidies to achieve full recovery.

Negative effects

According to Marcos, the rapid industrialization and economic expansion could have negative consequences for the labor sector.

“When there is rapid industrialization and rapid expansion of the economy, there is a tendency to leave the labor sector behind and just exploit the labor sector,” he said, adding that more than 96 percent of the businesses in the Philippines are small or “nano-enterprises.”

“Our workers, of course, are asking for a (wage) increase, workers in those small businesses. We might drive the businesses out because they (employers) cannot pay because they are too small,” he added.

Assessment

Meanwhile, on Thursday, June 29, Marcos expressed that while his administration has achieved significant changes and growth since he assumed office last year, there is still much more work to be done, particularly to fulfill his promises to the people.

During an interview with reporters in Parañaque City, Marcos acknowledged an economist’s assessment of his first year in office as “incomplete.”

“I saw a report earlier this morning where one of the economists said ‘the grade that I will give for the President is incomplete.’ I agree with him. We are not done,” Marcos said.

Marcos said his campaign promises are still a “work in progress,” one of which is to boost the country’s agriculture sector.

“There are many, many things that we still need to do. We have to undo 30, 35, almost 40 years of neglect when it comes to the agricultural sector. And the agricultural sector still occupies the most fundamental part of our economy,” said Marcos, who is also the concurrent secretary of the Department of Agriculture (DA).

“We have achieved a lot of growth. We are beginning to see the systemic changes that are going to be part of the new bureaucracy, but there is still a long way to go,” he added.

Inflation

Marcos also said that his administration has implemented initiatives to address the country’s inflation rate, which he considers as one of the challenges facing the Philippines.

Earlier this year, Marcos said finding ways to lower the country’s inflation rate kept him up at night.

In January, the country experienced a significant surge in inflation, reaching 8.7 percent, the highest annual rate recorded since November 2008.

However, inflation gradually decreased from February onwards, with rates of 8.6 percent in February, 7.6 percent in March, 6.6 percent in April, and 6.1 percent in May.

During this period, the country faced challenges in the supply of onions and sugar, resulting in a sharp increase in their prices.

The price of sugar soared to as high as P720 per kilo in December last year, while onion prices rose to over P120 per kilo.

In response, the administration established Kadiwa ng Pangulo in various parts of the country. This program, facilitated by the DA, aims to create market linkages and ensure accessibility, availability and affordability of essential commodities such as rice, fish, poultry, livestock, fruits and vegetables for low-income families.

It eliminates several marketing layers, enabling producers to earn greater profits by directly selling their produce.

One of Marcos’ campaign promises is to reduce the price of rice to P20 per kilo.

At a Kadiwa store in Quezon City, some residents are already able to purchase rice for as low as P25 per kilo.

Marcos stated that he will continue serving as the DA secretary until efficient systems are established to ensure the country’s food security. (KAL, TPM / SunStar Philippines)