DOLE warns of price hikes amid possible P100 minimum wage increase

The Department of Labor and Employment (DOLE) on Tuesday warned of possible increase in the prices of basic goods and services amid the possible P100 legislated hike in daily minimum wage.

DOLE Secretary Bienvenido Laguesma said that while he agrees that wage hike will increase the purchasing power of workers, he warned that it may also have an impact on micro and small businesses.

“Alam po natin na karamihan ng ating mga negosyante, nandoon sa maliliit na kategorya. Subalit meron po sigurong kakayanin, meron ding hindi kakayanin,” he told Unang Balita in an interview.

(We know that most of our businesses are under micro and small categories. But there are probably businesses that can handle the wage hike but some cannot.)

“Kapag merong pag-uusap tungkol sa pagtaas ng suweldo, medyo nakakaramdam na po tayo ng pagtaas ng presyo ng pangunahing bilihin. Iyon pong may kinalaman sa transport. So para pong ano 'yan chain reaction. Kaya ang lagi naman pong tinatanaw ng DOLE sana mabalanse,” he added.

(When there is talk about salary increases, we feel a little bit of increase in the prices of basic goods and also of transport services. It is like a chain reaction. That's why the DOLE is always looking for a balance.)

In line with this, Laguesma said the DOLE is looking for possible interventions to help micro and small businesses in case the minimum wage increases by P100.

He said these interventions will also ensure that workers will remain employed despite the financial impact of the wage increase on their employers.

There are over 4 million minimum wage earners in the country, Laguesma said, citing the Philippine Statistics Authority (PSA).

‘No capacity’

For his part, ECOP president Sergio Ortiz-Luis Jr. said micro businesses do not have the capacity to follow the proposed minimum wage.

“Hindi makakasunod yung mga micro and dagdagan mo ng P100, 15% to 30% i-increase (The micro businesses can't keep up because they will add P100, which is 15% to 30% increase),” he told Dobol B TV in an interview.

“Anong palagay mo mangyayari sa 90% na yun? Kalahati noong noong pandemya nagsara, yung iba naghihintay magbukas ay ayaw na,” he added.

(What do you think will happen to that 90%? Half of them have already closed during the pandemic, while others who are planning to reopen will not reopen anymore.)

The ECOP president pointed out that even without the intervention of the Senate, regional wage boards are already working and reviewing minimum wages annually.

On Monday, the Senate approved on third and final reading a bill increasing the daily minimum wage of workers in the private sector by P100.

Senate Bill 2534  or “An Act Providing for a 100 Pesos Daily Minimum Wage Increase for Employees and Workers in the Private Sector" garnered 20 affirmative votes, zero negative votes, and zero abstention.

The wage hike likewise excludes establishments with less than 10 employees, establishments utilizing a capital of P3 million and below, and establishments registered under Republic Act 9178.

The current daily minimum wage in the National Capital Region is at P610. —KBK/RSJ, GMA Integrated News