The country’s leading organizations of business executives and employers are voicing their concerns with the proposed ₱200 daily minimum wage increase, citing potential impact on investment, inflation, and small businesses.

The House of Representatives approved the bill proposing an across-the-board wage hike for workers in the private sector on Wednesday, June 4, in its third and final reading.

The measure now awaits the bicameral conference committee, where members of the House and the Senate reconcile the differences of their respective wage hike bills.

In February of last year, the upper chamber approved a counterpart bill proposing a ₱100 wage increase.

As the final step before the bill’s transmittal to the president, the Makati Business Club (MBC) and the Employers Confederation of the Philippines (ECOP) are cautioning the government of the consequences of legislating a nationwide wage increase.

MBC, which comprises the country’s leading business leaders, pointed out that increasing the minimum wage “may have a tendency to trigger added inflation.”

The group said lawmakers should instead focus on crafting measures that will help bring down the high prices of basic goods, especially food.

“If we don't address the prices of basic goods, there will be continuing pressure to keep increasing wages, which is not only inflationary, but also makes us less competitive and productive,” it said.

MBC warns that ramping up wages, which are already among the highest in Southeast Asia, will make the country “less attractive” for investors, leading to less job creation.

“The Makati Business Club is not against wage increases per se, and we do acknowledge the argument for wage increases now. We believe that these should be addressed by the regional wage boards (RWBs), which take into account the cost of living in the particular area,” the group said.

“There is no compelling reason for Congress to bypass these wage boards, as it has in this instance,” it added.

RWBs—comprised of business, labor, and government representatives—were specifically established to determine and set region-specific rates based on the local cost of living.

ECOP President Sergio Ortiz-Luis said this places President Ferdinand “Bongbong” Marcos Jr. in a difficult position as the proper way to raise wages has always been through the wage boards.

Malacañang earlier stated that it will study the economic implications and consult with the wage boards on the matter.

Ortiz-Luis has floated that the bill’s approval in the lower chamber could be politically motivated, “related to promises made during the election.”

He said the measure, if enacted, would affect micro, small, and medium enterprises (MSMEs), which account for 99 percent of businesses in the Philippines.

The wage adjustment, he said, would leave MSMEs with no choice but to raise prices, cut jobs, or close their business altogether.

Ortiz-Luis added that the measure would only benefit 10 to 16 percent of the 52 million workers in the country, leaving workers in the informal sector, such as farmers, fisherfolk, and jeepney drivers, without an added wage.

“Eighty-four to ninety percent will be suffering because of the yearly benefits we’re giving to the minority,” he said.