A business and labor leader in Bacolod City warned that a P200 wage hike would have an inflationary effect that could further erode the workers’ purchasing power.
The House of Representatives on Monday night approved on second reading the measure providing a P200 daily increase for minimum wage workers in the private sector.
A P200 legislated wage increase will have a “wage-push” inflation effect affecting the whole workforce, Frank Carbon, Metro Bacolod Chamber of Commerce and Industry vice president for governmental affairs, said.
He pointed out that the Philippine Chamber of Commerce and Industry (PCCI), the largest business organization in the country, is urging Congress to leave the determination of wage hikes to the Regional Tripartite Wages and Productivity Boards (RTWPB).
PCCI President Enunina Mangio, in a statement, said “a blanket national minimum wage does not take into account the differences in the cost of living across regions as well as the unique needs of businesses based on specific industry, location, and type of labor they need”.
The inflationary effect could further erode purchasing power negating the wage increase’s intended benefit, and reduce jobs in the market, she said.
Wennie Sancho, General Alliance of Workers Association secretary general, said P200 wage hike is too good to be true.
“While the labor sector welcomes a wage increase at this point in time a P200 per day increase in minimum wage across the board will increase the inflation rate that would negate whatever gains the labor sector will have,” he said.
A P50 to P100 increase might be possible for now but the government must support management by way of subsidies or tax incentives, he added.
“We cannot blame people to suspect that the proposed wage hike is politically motivated considering the timing of the forthcoming election,” Sancho said.
The proposed wage hike should be seriously evaluated because what is the use of a wage hike if it will have an adverse effects on our economy, he added.
Congress must amend or repeal Republic Act 6727 because the power to legislate wages is with the RTWPB as delegated by Congress in 1989, he also pointed out.*