ECOP on national minimum wage: Impossible

MANILA, Philippines — Raising minimum wages on a national level to cushion the impact of rising prices on ordinary Filipinos – as proposed by militant lawmakers and labor groups – would be “impossible” and would do more harm than good if allowed, according to employers.

“I’m not arguing that there is inflation, but the inflation in every region is different, that’s number one. Number two, the infrastructure development in every region is different as well so how can it be national? If there is no proper infrastructure development in these areas, they will find it hard to find jobs,” Donald Dee, president of the Employers Confederation of the Philippines (ECOP), said.

“So having national wages, it’s impossible. That’s not a workable idea,” he stressed.

Dee pointed out that at present, the salary of workers in the National Capital Region is already one of the highest in Southeast Asia, next to Singapore and Malaysia.

The Makabayan bloc in the House of Representatives has filed a bill mandating a uniform P750 minimum wage nationwide.

Socioeconomic Planning Secretary Ernesto Pernia called the proposal contained in House Bill 7787 “ill-advised as it will further stoke inflation and remain even when inflation normalizes.”

Sergio Ortiz-Luis, also of ECOP, said raising minimum wages on a national level would in fact put pressure on inflation.

He said higher minimum wages for workers in the provinces and regions would prompt companies and industries to also hike prices of their products and services.

“The basic thinking is if you raise the minimum wage we will be able to help the employees but that is not the case. In fact, the more that you will make it hard for the others that are employed and that is what they don’t understand,” Ortiz-Luis said.

“At the expense of the others in the economy, you will increase wages of those in the minority but you will let the entire nation suffer,” he added.

Of the country’s estimated 42 million to 44 million workers, Ortiz-Luis said only about seven percent are minimum wage earners, of whom only three percent are in the provinces.

The ECOP official also rebuffed claims that people from the provinces flock to Metro Manila because of the promise of higher salaries.

“No, that is not the case. They are not coming here because of higher salaries but because there are no jobs in the provinces,” Ortiz-Luis said.

“So which company will go to the provinces, which are in dire need of jobs, if the wages there are the same as in Manila? That will only aggravate the lack of jobs in the provinces,” he added.

Ortiz-Luis said greater attention should be given to the informal sector, which accounts for some 84 percent of the labor market.

“Those that need to be taken a look and given subsidies is the informal sector. The focus should be on them as they are the ones being left behind,” he said.

Subsidy backed

ECOP also said it sees no problem with the labor groups’ call for the grant of P500 subsidy to minimum wage earners. “If the government can provide that subsidy then why not?” Ortiz-Luis said.

National Economic and Development Authority (NEDA) undersecretary for policy and planning Rosemarie Edillon said complying with the law on wage setting and expediting the release of unconditional cash transfer should be enough to ease the impact of rising prices on workers.

“The law is clear on the process of wage-setting. We will follow the process,” Edillon said.

“We will accelerate the release of the unconditional cash transfer,” she added.

“The increase in fuel prices is not due to TRAIN anymore. We already had the increase in January. The price difference between end-January and what we have now is not due to TRAIN,” she said.

Before filing HB 7787, the militant lawmakers held protests at the South Gate of the Batasan Pambansa complex in Quezon City, where they also called for the repeal of the TRAIN or the Tax Reform for Acceleration and Inclusion law.

“The minimum wage must be reverted back to a national wage standard. Almost all prices of basic goods and services being traded in all regions are similar nationwide. Some are even higher in regions outside of NCR because of the transportation cost,” Rep. Carlos Isagani Zarate of party-list Bayan Muna said.

With him were lawmakers from women’s group Gabriela (Emmie de Jesus, Arlene Brosas), Kabataan party-list (Sarah Jane Elago), Anakpawis (Ariel Casilao) and ACT Teachers (Antonio Tinio and France Castro).

“It is gravely wrong to peg as lower the standard of living of regions outside Metro Manila because it is not reflective of the real situation,” Zarate added.

“A P750 national minimum wage is what workers need now to somehow cope with the surging prices of goods,” he added.

“Truth be told, the wages of our workers have long been stunted and purchasing power gravely diminished. This amount is still short of the P1,168 needed daily to support a family of six as of March this year based on a study by the think tank IBON Foundation,” he said.

For its part, Gabriela is pushing for the abolition of the decades-old regional wage boards for their “utter failure to ensure a decent standard of living for Filipinos across different regions.”

“The regional wage boards have only ensured a ‘race to the bottom’ among regions in terms of wages, and that approved wage hikes throughout the years will be measly,” De Jesus argued.

“Imagine, the current minimum wage in ARMM which is P263 is just around 50 percent of the P512 minimum wage in NCR. This severe wage inequality should be addressed. Wage boards should be abolished,” she said.

For her part, Brosas said President Duterte could easily move the supermajority to approve a legislated P750 national minimum wage if he is really sincere in his promise to ensure a comfortable life for Filipinos. – With Delon Porcalla, Czeriza Valencia, Mayen Jaymalin