Four business groups have issued a unified warning regarding the P50 wage hike in Metro Manila, saying it could lead to layoffs, hiring freezes, and a halt to expansion, as small companies will struggle to cope with the increased daily minimum pay.
These groups are the Metro Manila Chamber of Commerce (MCC), the Philippine Chamber of Commerce and Industry (PCCI), the Employers Confederation of the Philippines (ECOP), and the Philippine Exporters Confederation (Philexport).
“It’s really wait-and-see for now. There will be no new hires, that’s a primary option,” Hernando Delizo, chairman of the Metro Manila Chamber of Commerce (MMCC), said in an interview late Friday in Taguig City.
However, MMCC members will honor and comply with the P50 Increase, as this is a better option than a legislated one, Delizo said, on the sidelines of a press briefing announcing the group’s forthcoming conference in August.
The president of the Philippine Chamber of Commerce and Industry (PCCI), Enunina Mangio, said in a separate interview on Friday she would not discount the possibility of some companies in NCR either stopping hiring or cutting their workforce.
“But we don’t want to do that. The business sector is likely to comply with this increase, conducting a careful evaluation of its impact. What will happen is a chain reaction: companies will be forced to either stop hiring or reduce the number of employees. Nevertheless, we accept (it) because it went through the wage board rather than a legislated (wage hike),” Mangio said.
Delizo said businesses in NCR hope the government will support them in keeping quality jobs, not through over-regulation and anti-business impositions.
“The only option is if there is a counterpart government intervention,” Delizo said. ”For example, if a business introduces new technologies, will it receive an incentive? If the government supports us in terms of the logistics cost, that will be very helpful,” Delizo added.
In a separate statement late Friday, the Employers Confederation of the Philippines (ECOP) expressed apprehension over the impact of the NCR salary increase on micro-enterprises.
ECOP and the Philippine Exporters Confederation, Inc. President Sergio R. Ortiz-Luis Jr. said he expects micro-enterprises to be seriously affected by the pay raise because the computation would show that the actual increase could be more than the stated amount.
Microenterprises represent about 90 percent of businesses in the country, he said.
Ortiz-Luis explained that with the adjustment, the contributions of both the employee and the employer to social security will also increase.
In an earlier interview with Malaya Business Insight, Ortiz-Luis said that Wage Order 26 would be an extra expense that could hurt micro and small enterprises, which comprised a significant portion of local industries, especially in the NCR.
ECOP members are mostly medium to large companies, which account for just 2 percent of the enterprises in the country, he added.
“We will support it because it went through the process… and it has been calibrated. It’s certainly lower than the P100 being sought earlier, but then the wage board came up with a formula based on inflation for a certain period to justify the P50 (increase),” Ortiz-Luis said.
The decision, he said, is proof that wage boards are still the best platform for determining adjustments rather than through legislation.
Ortiz-Luis said this increase is on top of the P35 approved in 2024 and P40 in 2023, totaling P75 over the past two years.
Wage Order 26 granted the highest pay hike ever to minimum wage earners in Metro Manila, effective July 18.
The raise would benefit about 1.2 million workers in Metro Manila and nearby cities and provinces.
The new daily minimum wage in the NCR is expected to increase to P695 from P645 for the non-agriculture sector, and to P658 from P608 for agricultural workers and employees in service and retail establishments with 15 or fewer workers.
Laborers in manufacturing establishments employing fewer than 10 workers will also receive a daily wage of P658.
The daily pay hike is equivalent to a P1,100 per month increase for a five-day work week, or a P1,300 increase for those working six days a week.
