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Leading union says wage hikes already wiped out by surging fuel prices

A cyclist passes by at street level as workers install a drainage system in Marikina in this June 2021 photo. — PHILSTAR/ MICHAEL VARCAS 

THE Trade Union Congress of the Philippines (TUCP) said on Monday that the impact of recent hikes in the minimum wage has been offset by higher fuel prices, keeping workers below the poverty line.

The TUCP, the Philippines’ largest labor federation, said in a statement that the rising prices of basic goods that stem from the surge in fuel prices make it more difficult for workers to live on poverty wages.

“The buying power of the current wage adjustments is being dissipated by the series of previous and present extraordinary increases in the prices of basic commodities and cost of services and have no impact in lifting the lives of workers from worsening poverty caused by the pandemic crisis,” TUCP President Raymond C. Mendoza said.

“Because of extraordinary inflation, the series of wage increase orders issued by the wage boards failed to restore the purchasing power of wages and (they) didn’t uplift workers’ purchasing power above poverty threshold wage level,” he added.

The Labor department on Sunday announced that new minimum wages will be implemented in 14 regions this month, after regional boards approved wage hikes of between P30 and P110.

Seaoil Philippines and Phoenix Petroleum Philippines announced in separate advisories on Monday fuel price hikes of P2.70 per liter of gasoline and P6.55 per liter of diesel, which will take effect on Tuesday.

“Prices can flexibly go up and down but government wage orders are inflexible,” Bienvenido S. Oplas, Jr., founder of free-market think thank Minimal Government Thinkers, said in a Viber message when asked to comment. “Soon a combination of oil and intermediate goods price hikes plus wage hikes will force companies to reduce workers and (will be) a worse outcome for labor.”

“This phenomenon directly hit the lives of workers and their families already bearing the brunt of the pandemic, in particular, the informal workers, the daily paid and the minimum waged workers who are mostly contractual and short-term, end-of-contract employees,” Mr. Mendoza said.

The new minimum wage in Metro Manila increased by P33 on June 4 to P570 for non-agricultural workers, and P533 for agricultural workers.

Central Luzon will see a P40 increase to P414-460.

The new daily wage in Calabarzon is P390-P470 for nonagricultural workers; P350-P429 for agricultural workers; and P350 for retail and service establishments with not more than 10 workers.

The Department of Energy estimates that gasoline, diesel, and kerosene prices have increased by P23.85 per liter, P30.30, and P27.65, respectively in the year to date as of May 31. — John Victor D. Ordoñez

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