Members of Kilusang Mayo Uno call for raising the minimum wage amid rising prices of market goods in Quezon City on January 21, 2021. Mark Demayo, ABS-CBN News/file
MANILA — One of the government’s economic managers on Tuesday thumbed down calls for a legislated wage hike saying this would harm the economy.
National Economic Development Authority (NEDA) Director General Arsenio Balisacan told lawmakers that while he agrees that wages need to rise, this should be achieved through increased economic activity instead of legislation.
"If you want to bring this country to the league of our neighbors, the safest thing to do is to increase wages by way of increasing economic activity and that means a lot of investment that would have to be made to complement labor,” Balisacan said.
"It's very harmful to the economy in the longer term and even for labor if wages are forced to increase by legislative fiat," Balisacan said.
He said it would be better for wages to rise because the demand for labor is high.
Balisacan was responding to House Deputy Minority Leader Rep. France Castro, who asked him and other government economic managers for ways to deal with the country’s inflation.
But he said he was also wary about how higher minimum wages would affect the country's productivity.
"If wages will rise not because of productivity, how can we export? How can our products become competitive in the international market?" Balisacan said.
For her part, Budget Secretary Amenah Pangandaman said that the Governance Commission for Government Owned and Controlled Corporations has been tasked to study a salary increase for government workers.
"I think Sec. Arsi Balisacan is referring to the minimum wage, not the salary of government employees. For the salary of government employees, it has been mentioned po previously that we have allocated a fund and it was given to GCG and the GCG now is doing a study on a possible increase of the salary of government workers," Pangandaman said.
Inflation has kept rising in recent months, with the Bangko Sentral ng Pilipinas (BSP) saying that February’s inflation rate may settle between 8.5 and 9.3 percent.
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