Concepcion: Creating jobs more sustainable than legislated wage hike

A skilled workforce and a vibrant economy that creates jobs are a more sustainable approach to attaining higher wages instead of immediately increasing the minimum wage, according to entrepreneurship advocacy group Go Negosyo.

As the economy grows, more jobs will be generated and with the increased demand will come higher wages for more people, Go Negosyo founder Joey Concepcion explained.

“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, jobs sector head of the Private Sector Advisory Council.

He made the statement following proposals by House of Representatives members to raise the minimum wage by P350, higher than the P100 wage hike approved by the Senate.

Upskilling and reskilling workers is also another long-term solution to raising wages, Concepcion added.

“This will make Philippine labor competitive with our ASEAN neighbors,” he said.

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 argued.

“Using wage increases to spur the economy is a tricky situation. Eventually, smaller companies will not survive and they will close shop. Rather than having people with jobs, you will have people with no jobs,” he added.

Minimum wage hikes should be left to the regional wage boards, he noted.

The regional tripartite wages and productivity boards are tasked to review and adjust minimum wages in the context of factors like inflation, cost of living and economic conditions in their respective regions, Concepcion said.

When significant wage adjustments are deemed necessary beyond the regional level, legislation can be passed by Congress and signed into law by the President, he added.

He believes there is now industrial peace, given the declining number of strikes in past years.

“This means employers and employees are in agreement,” he said, noting that some large companies’ collective bargain agreements exceeded the minimum wages mandated by the government.