PRESIDENTIAL Adviser for Entrepreneurship Jose Maria A. Concepcion raised the need to allow the economy to recover first—as business activities have been generally muted in the past two years—before considering a wage hike.
The Go Negosyo founder, in a TV interview on Wednesday, said that proposing an increase in wages must only be entertained after seeing how the economy responds two or three months following the easing of quarantine measures to Alert Level (AL) 1.
“Let’s have our economy have a momentum. Allow some time for people to recover,” he said, noting that business establishments are still in the early stages of their reopening.
Concepcion said that the small entrepreneurs were the most affected by the pandemic amid the implementation of mobility restrictions that dampened consumer demand. “They’re the ones severely affected. We have to give them time,” he added.
For medium to large companies, not all of them were able to resume operations as well, he noted. It is only during the recent move to AL 1 that most businesses were able to restore 100-percent operating capacity.
The loosening up of travel restrictions, he said, will boost the tourism sector.
Still, he has some concerns as to whether arrivals will increase given that the neighboring countries are seeing a surge in Covid-19 cases.
“Let’s see how things improve,” he said.
He said it was also important to factor in the increasing commodity prices due to the Ukraine-Russia conflict in proposing wage hike. The tensions in Europe have prompted fuel prices to soar, which has taken a toll on other commodities as well.
Concepcion said the private sector is implementing gradually the price increase to not fully pass on the additional costs to consumers immediately.
“Inevitably, there is no way you can keep prices at the same level,” he said.
Over the weekend, Trade Undersecretary Ruth Castelo said no manufacturers have asked yet to increase suggested retail prices (SRP) for basic goods and commodities amid the fuel price hike.
Should there be an increase in SRP, the trade official explained that they will “validate” the price hike and negotiate if the increase is too much of a burden for the consumers.
The Development Budget Coordination Committee said last week that the government is prepared to extend a total of P3 billion in fuel subsidies and discounts to cushion the impact of rising oil prices on the transport sector, farmers and fisherfolk.
On Wednesday morning, Palace officials announced that President Duterte has approved release of such subsidies.