The Federation of Filipino Chinese Chambers of Commerce and Industry, Inc. (FFCCCII) and the Foundation for Economic Freedom (FEF) have joined earlier opposition by other business groups on the proposed P200 legislated wage increase, and instead urged the government to avoid inflationary move, improve farm productivity and adhere to the existing regional wage boards.
In separate statements, the FFCCCII has called for more consultation in determining wage adjustments to achieve sustainable economic growth.
“We believe that wage increases should be carefully calibrated taking into account inflation, regional cost-of-living disparities, and the financial viability of businesses, particularly micro, small, and medium enterprises (MSMEs)—the backbone of the Philippine economy,” said the FFCCCII statement signed by its president Victor Lim.
The country’s largest Filipino-Chinese business group, FFCCCII warned of unintended consequences of a legislative wage to include “reduced competitiveness of local enterprises, potential job losses, and diminished foreign investment confidence.”
Instead of a legislated wage, FFCCCII strongly advocated for continuing regional tripartite consultations involving labor, business, and government to ensure that wage policies are equitable, data-driven, and reflective of economic realities.
“This is better because we already have tripartite mechanism under our current law. We stand ready to collaborate with all stakeholders in crafting solutions that balance workers’ welfare with business sustainability, safeguarding the long-term health of the Philippine economy,” FFCCCII concluded.
Meantime, FEF cautioned against the approved House Bill No. 11376, or the Wage Hike For Minimum Wage Workers Act, mandating a PHP 200 across-the-board daily increase in the national minimum wage.
“While we recognize the legislature’s intent to uplift the conditions of Filipino workers, we caution that this blunt policy will result in broad economic harm, from accelerating inflation and job losses to marginalizing the informal sector,” FEF said.
FEF cited the declining inflation as government focused on improving supply and reducing trade barriers, especially for staple food.
But the decline in prices of basic goods is expected to rise and turbocharge inflation under a mandated wage hike wiping out the supposed gains the wage hike intends to provide.
With labor accounting for up to 30 percent of total operating costs in many industries especially in food, retail, and services, FEF said the added wage burden is likely to be passed on to consumers, fueling a wage-price spiral that disproportionately hurts the poor.
Consequently, FEF said a mandated wage hike will hurt the MSMEs and exclude the informal sector, which comprises the majority of Filipino workers, from any benefit, while exposing them to higher prices.
A legislated wage hike will also undermine the Regional Tripartite Wages and Productivity Boards, which are designed to balance regional cost structures, employment conditions, and productivity levels. These boards exist precisely because wage affordability varies widely. Instead of improving livelihoods, the measure risks trapping more Filipinos in a vicious cycle of inflation, unemployment, and informality.
To truly and sustainably improve Filipino welfare, FEF urged Congress and the Executive to instead pursue food trade liberalization to bring down prices and ease inflationary pressures, boost agricultural productivity, and focus on job creation.
