Artazo, Vina Mariel B

ABM 11 – Ruby

English For Academic and Professional Purposes

Mrs. Nazima Y. Basilio

Is the Minimum Wage of Filipino worker enough?

A minimum wage is the lowest remuneration that employers are legally permitted to pay
their employees—the market mechanism below which employees are prohibited from
selling their labor. By the end of the twentieth century, most countries had enacted
minimum wage legislation. In the Philippines, the minimum wage is progressively rising
from 316 pesos to 537 pesos a day. Is the minimum salary enough to cover a minimum
wage earner’s daily expense, despite the country's minimum wage gradually
increasing?

It's no surprise that low-wage workers are the severely impacted by rising prices. Recall
how much noise there was last year about increasing food and other basic needs
prices? Furthermore, these employees are typically those who lived far from their
workplace (due to exorbitant property prices in metropolitan areas) and must spend
money on transportation as well as hours on the route to travel to and from work. The
government should identify measures to assist them in reducing their financial load. The
same may be said for private employers, especially those who have been making a lot
of money for a long time.

The Philippines' largest labor organization, the Trade Union Congress of the Philippines
(TUCP), will file a petition to raise the present daily minimum wage for ordinary workers,
arguing that it is no longer sufficient for workers to live a decent living. According to local
media, TUCP will file a petition for a P710 across-the-board daily wage raise for private-
sector sector workers ahead of Labor Day celebrations in the Philippines. Workers in
Metro Manila must earn at least P1,247 per day, according to the labor group, in order
to provide for their families' basic needs. "In view of growing food and service costs
caused by taxes and inadequate government services and social protection assistance
to impoverished Filipinos," TUCP added, "the present P537 salary for minimum wage
laborers in Metro Manila is highly insufficient." The group is urging the Regional
Tripartite Salaries and Productivity Board to set "realistic wages," recognizing that a
worker's daily compensation is influenced by a variety of factors.
The Netherlands, Spain, Luxembourg, and Germany were among the nations where
minimum wage earners needed to spend less than 10% of their monthly earnings on
such a food basket. A minimum wage American citizen required to set aside 14% of his
monthly income for the food basket. The majority of our neighbors had it better than us.
In Indonesia and Malaysia, minimum wage earners required 34.7 percent and 37.2
percent of their monthly income, correspondingly, to cover their basic needs such as
food. (Minimum wage earners in Metro Manila will fit into that category as well.) Those
who are in Vietnam had to pay 53.7 percent, while those in Thailand had to pay 56.4
percent. In general, the top-ranked countries – the majority of the developed world —
had a mix of increased income and reduced consumer costs.

"The Philippines is at the 17th spot out of 54 countries tracked by Picodi in terms of rate
of increase in minimum wage year-on-year. In comparison, minimum wage jumped
9.1% in Malaysia, 8.7% in Hong Kong and 1.6% in Thailand this month. However, high
food prices are eating up a significant portion of the compensation that minimum wage
earners in the Philippines took home. According to Picodi, minimum wage earners in the
country spend 75.1% of their monthly salary on basic food items alone. But the surge in
wages outran the increase in prices in the Philippines this year, Picodi said, with basic
food products previously accounting for 81.3% of workers’ monthly pay. The cost of
daily necessities is continuing to rise, according to TUCP, which is why the latest wage
boost for Metro Manila employees, which was only worth Php25, is no longer sufficient.
"Due to a variety of variables, including the effect of the Tax Reform for Acceleration
and Inclusion [Act] since Jan. 1, 2018, the P25 rise has long been diluted by rising
expenses of basic goods and services, even before it could be felt by minimum wage
laborers," the labor organization said. "In the [metropolis], the current minimum wage of
P537 barely fulfills basic human necessities for food, water, clothing, education,
transportation, health, housing, toiletries, and energy," TUCP noted. Workers in Metro
Manila, according to TUCP, deserve greater pay for the labor they do, and a minimum
wage adjustment would be an insult to them.

In conclusion, minimum wage of a worker is not enough for its expenses. Minimum
wage of a worker is gradually increasing, but their expenses is also increasing. Raising
the minimum wage is indeed a smart option. Since a wage increase benefits relatively
low individuals more than intermediate households, it is likely to have a greater impact
than many, if not all, in most developing countries, increasing the minimum wage helps
to eradicate. However, the benefit is limited because the minimum wage covers only a
small percentage of impoverished people; it does not, for example, cover workers in the
major unorganized industries. And, relying on employment impacts, salary dispersion,
and consequences on the household head, increase in the minimum wage generates
positives and negatives within impoverished households, lifting something out of poverty
while pulling others back into it. Raising the minimum wage could be part of a larger
poverty-reduction strategy, and it should not be the only, or even the most important,
option available.

Bibliography
Cigaral, I. (2020). ‘Philippines one of the worst countries to live for minimum wage earners’. Philstar.com.

Cooper, D. (2020). Now is still a good time to raise the minimum wage. Working Economic Blog.

Gindling, T. H. (2018). Does increasing the minimum wage reduce poverty in developing countries? IZA
World of Labor.

Philippine Daily Inquirerer. (2019). Poor minimum wage earners.