Chamber warns prices will rise if wage hike bill becomes law
THE Federation of Filipino Chinese Chambers of Commerce and Industry, Inc. (FFCCCII) said a legislated minimum wage hike could result in further price increases in an already high-inflation environment.
FFCCCII President Cecilio K. Pedro said he has held discussions with government officials on the proposed P100 minimum wage increase for private-sector employees which is pending in Congress.
“I told them that although the proposal is good for workers at minimum salaries, at this point, we need to think about how we can stabilize things first,” Mr. Pedro said.
“Initially, they even wanted to increase it by P150, but I told them that it will affect a lot of sectors and it could be a reason for businesses to increase prices immediately,” he said, adding that such an increase would be equivalent to raising wage expenses by 20%, he added.
He said that even with just a P100 increase called for in the recently approved Senate Bill No. 2534, the employers’ wage costs will still rise at least 15-16%.
“It’s very, very high. So we need to talk about it, and we need to think of what would be the best solution and I think that it is best for it to go through a wage tripartite meeting,” he added.
Under the Wage Rationalization Act, the National Wages and Productivity Council and the Regional Tripartite Wages and Productivity Boards (RTWPBs) are authorized to study, fix, and raise wages based on local conditions.
Last year, 16 RTWPBs granted another round of daily wage hikes. The minimum wage in the National Capital Region is currently P610.
“We are not against wage hikes principally because that is needed by our minimum wage earners, but we prefer it to be discussed in the tripartite committee (so) every other aspect of business will be considered,” Mr. Pedro said.
He said businesses are still dealing with high inflation and rising logistics and electricity costs.
“We have one of the highest electricity costs in the world … We have to think of ways to lower our electricity cost,” he added.
Headline inflation decelerated to an over three-year low of 2.8% in January, falling within the Bangko Sentral ng Pilipinas’ target of 2-4%.
Manila Electric Co. raised power rates by P0.5738 per kilowatt-hour in February. — Justine Irish D. Tabile