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Manila Bulletin devider Business devider Garment manufacturers seek wage hike deferment

Garment manufacturers seek wage hike deferment

Published May 31, 2022 05:54 pm

Domestic garment manufacturers are seeking for a one year deferment of the daily wage hike approved by the Regional Tripartite Wages and Productivity Board (RTWPB) to enable them to recover and prevent job losses as they deemed the recent salary increase “too much” to bear.

Marites Agoncillo, executive director of the Confederation of Wearable Exporters of the Philippines (CONWEP), raised the difficulties of garment firms during a dialogue with Sen. Imee Marcos, who was keynote speaker at the signing of a memorandum of understanding between the Philippine Economic Zone Authority (PEZA) and the Department of Environment and Natural Resources. Senator Marcos is chairman of Senate committee on economic affairs.

Agoncillo noted that garment manufacturers are looking at 5-6 percent increase in minimum wage based on increase in inflation in the regions, but certain regions were granted 10-15 percent increase in minimum daily salary.

“We requested to defer or a gestation of at least a year so we can recover,” said Agoncillo, adding that the increase effectivity can start around the second quarter of 2023.

“Bottomline, the wage increase is too high for specific regions, like Region 3 is almost 10 percent increase and Region 7 is almost 7.7 percent increase.”

According to Agoncillo, the P40 increase in Region 3 is already a threshold as it is almost a US dollar increase. These will put them behind competition from other producers such as Cambodia, Vietnam, Indonesia, and Laos.

“We are now at another stand still as we continue to price ourselves out of the global competitiveness structure,” she said.

If garment manufacturers are not granted the requested one year gestation period on the wage hike effectivity, Agoncillo said that around 15 percent of workers in the regions may be affected.

Region 3 comprises the provinces of Aurora, Bataan, Bulacan, Nueva Ecija, Pampanga, Tarlac, and Zambales. Region 7, which is located in the central part of the Visayas island group, consists of four provinces – Bohol, Cebu, Negros Oriental, and Siquijor -- highly urbanized cities and developing municipalities.

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