Amid proposals of legislated wage hikes lawmakers, an owner of food and beverage giant RFM Corporation suggest to the Marcos Jr. administration to produce more jobs that are more feasible for workers to cope with inflationary headwinds, rather than raising the current wage.
RFM Corp. president and CEO Joey Concepcion on Wednesday said that a skilled workforce and a vibrant economy that creates jobs is a more sustainable approach to giving people higher wages, just like the proposals by members of the House of Representatives to raise the minimum wage by P350, higher than the P100 wage hike approved by the Senate.
“We all want to improve the lives of our employees, but what is important is for the economy to continue to grow,” said Concepcion. He explained that as the economy grows, more jobs will be generated, and with the increased demand will come higher wages for more people. It happens in sectors where we lack a supply of workers. An example of that is our nurses; they are paid well because the demand for nurses is high,” said Concepcion.
With this, the RFM Corp. honcho, also the chairperson of Go Negosyo, stressed that upskilling and reskilling workers is another long-term solution to raising wages.
“We will help our workers upskill and reskill because this will make Philippine labor competitive with our ASEAN neighbors. A highly skilled workforce that can attract foreign direct investments will boost economic growth, which in turn can spur more jobs and increase wages on a more sustainable basis than boosting spending power on the scale and speed being proposed by legislators,” he stressed.
Concepcion maintained that “using wage increases to spur the economy is a tricky situation,” he said. “Eventually, smaller companies will not survive, and they will close shop. Rather than having people with jobs, you will have people with no jobs.”
Furthermore, Concepcion said that the matter of minimum wage hikes should be left to the regional wage boards.
“The focus is the economy and for us to create more jobs. Let the regional wage boards handle the minimum wage increases,” adding that the Regional Tripartite Wages and Productivity Boards are the ones tasked to review and adjust minimum wages in the context of factors like inflation, cost of living, and economic conditions in their respective regions.
However, when significant wage adjustments are deemed necessary beyond the regional level, legislation can be passed by Congress and signed into law by the President.
Concepcion believes that there is now industrial peace. “Over the last few years, we have not seen as many strikes as before. This means employers and employees agree,” he said, adding that some large companies’ CBAs (Collective Bargain Agreement) even exceed the minimum wages being mandated by the government.
“They have to be careful with the Php350 wage hike. Nobody in history has done that, and that will shake down a lot of companies. Business is not against giving wage increases but we have to be careful when we do it, and how we do it, especially considering our MSMEs comprise 99 percent of enterprises and generate more than half the jobs here. They cannot afford the wage increase because they are survival entrepreneurs,” he said.