Friday, April 29, 2011
Thursday, April 28, 2011
BusinessWorld Online Edition | May Day distress call
No one -- not even employers or the government -- will dispute the sad state of Philippine labor today. The figures do not lie or dissemble. And yet year in and year out, government and employers merely raise their hands and feign helplessness over the situation. They repeat the same old line: wage increases would result in inflation, causing greater woes for workers including the threat of losing their jobs, since higher wages could result in their employers going bankrupt.
What are hidden from view are the huge profits raked in by foreign and local corporations in stark contrast to workers’ starvation wages.
Preliminary results of the 2008 Annual Survey of Philippine Business and Industry (ASPBI) of the National Statistics Office (NSO) as cited by IBON Foundation, show that establishments in the country with total employment of 20 and over had combined profits of P895.2 billion and 2.74 million employees.
Even more revealing, the Top 1,000 corporations in the country reaped a cumulative annual net income of P3,788.9 billion over the period 2001-2009.
According to IBON, an across-the-board wage hike of P125 means workers will receive an additional P3,802 per month. Employers will spend an additional P49,427 per employee per year (assuming 13 months of pay). The total cost of the proposed wage hike will only be P135.6 billion which, subtracted from total profits, will still leave establishments with P759.6 billion in profits.
The P125 across-the-board increase called for by the Kilusang Mayo Uno will only cut employers’ profit margins by 15%. Assuming employers will not pass on to consumers any legislated minimum wage increase, there will be no significant inflationary effect. Because their enterprises continue to be profitable, there is no reason for them to close shop.
Consider that the average daily basic pay that wage and salary workers in the country actually received -- as opposed to merely mandated minimum wages that are not necessarily actually paid -- increased from P222 in 2001 to a measly P301 in 2010 (NSO Labor Force Survey, April 2010). The minimum daily wage of P404 in the National Capital Region is not even half of the estimated average family living wage (FLW) of P988 as of March 2011.
A large wage hike will be beneficial not just for workers and their families but also the economy, IBON added. The transfer of money from rich to poor households will increase aggregate demand and stimulate the economy...
BusinessWorld Online Edition |MayDay distress call
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