Exporters of apparel, leather goods and footwear are asking for a two-year inflation subsidy of P600 to P1,000 for its minimum wage workers instead of implementing the P100 legislated increase proposed in Congress.
Marties Agoncillo, executive director of the Confederation of Wearable Exporters of the Philippines (CONWEP), in a press conference said a mandated increase would whittle down the workforce of the industry to 32,000 to 48,000 or just 20 to 30 percent of its existing workers of 160,000.
Even without the wage increase, the industry projects a 12-percent cut in workforce or about 21,900 workers this year because of the past year’s wage increases in regions 3,4, and 7.
This is based on a survey done by CONWEP on February 22 which also projects another 11 to 15 percent decline in export to $1.2 billion for apparel, leather goods and footwear.
Agoncillo said exports could fall further by 10 percent in 2025 because of soft global demand.
Agoncillo said the Philippines has lost 23,200 workers because of the pullout of a big exporter of a sports apparel brand in 2022 and 2023.
She said a US sports brand has sounded off the possibility of pulling out its orders also this year.
Agoncillo fears an exodus of investments within six months from the passage of a dongressional wage increase of any amount, even if implemented in tranches.
“We are in a survival mode, this wage increase is the final nail in our coffin,” she added.
In a letter to President Ferdinand Marcos Jr. dated February 26, Agoncillo said the two-year monthly P1,000 government inflation subsidy to minimum wage earners could be similar to assistance programs granted to workers during the pandemic “ to allow the industry to recover as global demand for apparel exports remains soft until March 2026.”
She said competitor countries Vietnam, China, and Cambodia have implemented support programs similar to those of their apparel export sectors in previous years.
