THE country’s largest business organization Philippine Chamber of Commerce and Industry (PCCI) is urging Congress to allow Regional Tripartite Wages and Productivity Board Boards (RTWPBs) to determine wage adjustments, following the recent approval by the House of Representatives of a P200 daily minimum wage increase.
In a press statement posted on the chamber’s Facebook page, PCCI president Enunina Mangio expressed concerns over the proposed wage hike, emphasizing that the RTWPBs—composed of representatives from business, labor and government—were specifically created to set region-specific rates based on the local cost of living.
“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,” Mangio said in a statement. “Cities have higher costs of living versus rural areas. Legislating a single wage for all areas can harm businesses in lower-cost regions and remove the flexibility of the RTWPBs to set wages that are aligned with the situation in the local areas. This could lead to business inefficiency and stagnation.”
While the proposed wage hike aims to improve workers’ livelihoods, PCCI warns of its potential economic consequences, particularly for micro, small and medium-sized enterprises MSMEs, which operate on tight margins.
“The mandated wage hike will force these small enterprises to shoulder higher payroll expenses. For some businesses, particularly those in low-margin industries like retail, hospitality and agri-food, the wage increase forces them to pass on the cost to consumers,” said Mangio.
PCCI further warned that the inflationary impact of a wage hike could erode workers’ purchasing power, negating its intended benefits, while also reducing employment opportunities. Workers in the informal sector—who are not covered by minimum wage laws—would be particularly vulnerable to rising costs.
Mangio also highlighted the risk of formal-sector micro-enterprises shifting some operations to the informal sector to cut costs, potentially undermining efforts to expand the country’s formal economy. According to government statistics, the formal sector employs around 10 to 12 million workers (25-30 percent of the total workforce), while the informal sector accounts for 15 to 20 million workers (40-50 percent).
PCCI said a legislated minimum wage hike not only exacerbates the already rising cost of goods and unemployment but also fails to provide long-term solutions for productivity and competitiveness.
Rather than a legislated wage increase, PCCI is advocating for a more comprehensive approach to wage policy—one that considers economic growth, business productivity, job security and real purchasing power for workers.
“For wage policy to be meaningful, it should prioritize economic growth and stability, business productivity, secure and quality jobs, and real purchasing power for workers,” Mangio said.
Earlier, business leaders in Cebu strongly opposed the P200 minimum wage increase warning that it could lead to higher inflation, job losses and reduced competitiveness for companies, especially MSMEs. / KOC
Source: https://www.sunstar.com.ph/cebu/pcci-urges-congress-to-let-regional-wage-boards-decide-on-wage-hikes

PCCI urges Congress to let regional wage boards decide on wage hikes