Organized workers are marking Labor Day today with a request for a hefty increase of P710 in the daily minimum wage in Metro Manila. The Trade Union Congress of the Philippines says laborers and their families are undernourished because they cannot afford the food items that provide minimum nutrition requirements.
Even with last year’s spike in inflation as excise taxes were slapped on fuel and rice prices soared, the daily wage went up by only P25 in Metro Manila. In consultation with employers and the government, the P710 is expected to just serve as the starting point for bargaining.
This being election season, some candidates have also revived proposals for a legislated wage hike, citing figures touted by some sectors that there are only slight differences in the cost of living across the country. The reason for tripartite consultations and regional wage-setting, however, is to ensure that any wage increase can be implemented. The consultations are also meant to keep the country competitive in attracting the investments needed to create meaningful employment.
Any wage increase that might be approved is unlikely to be enough for organized labor. The best employers understand that worker satisfaction has a direct link to productivity, but interests must be balanced to sustain both jobs and businesses.
More effort is needed to make the country an easier place to do business. This requires improving governance and implementing structural reforms. The country must attract investments that will create meaningful jobs so that fewer Filipinos will feel that they can receive decent pay only if they work overseas. Their billions in remittances have made them modern-day heroes, but the social costs of the overseas worker phenomenon can be steep for many families, and it is creating a shortage of skilled workers in many industries in the Philippines.
Beyond wage increases, there are other ways of promoting the welfare of workers. With Build Build Build, the government is being urged to ensure that the jobs created go to Filipinos rather than foreigners. There’s a wide room for improvement in the agriculture sector, where rice farmers feel threatened by the flood of imports with the approval of the rice tariffication law. Artificial intelligence is threatening voice business process outsourcing; workers in this sector urgently need skills upgrading. Tourism creates meaningful jobs, but travel destinations and the tourism infrastructure need improvement. A lot can be done to make Labor Day a day of celebration rather than protest.