Philippines Workers Salary Increase In June 2024: Check Expected Salary and Minimum Wage Increase

The Philippines is going to see substantial changes in its compensation and minimum wage systems in the year 2024. This is a development that is expected to affect millions of workers across a variety of industries. This article explores the anticipated increases in salaries, the reasoning for these changes, as well as the ramifications for the workforce and the economy of these adjustments.

Because the cost of living is continuing to increase, these modifications are intended to improve the quality of living for Filipino workers and to address the widening gap that exists between earnings and inflation.

Philippines Workers Salary Increase In June 2024

Employees in the Philippines have a reason to look forward to the year 2024 since they will soon be receiving a large increase in their salaries in the Philippines. The wage increases that have occurred in the Philippines may be attributed to the wage Standardization Law of the Philippines, which is responsible for establishing yearly compensation modifications that are based on current trends.

At present, inflationary pressures and concerns over a competitive labour market continue to have an impact on the budget planning process for Salary Increases. According to the proposed legislation, the Department of Budget and Management (DBM) would be responsible for developing an adjusted four-tranche payment increase schedule beginning on January 1, 2024, and continuing on an annual basis until 2027.

Additionally, the Philippines Salary Increase System is designed to promote employee accountability and efficiency. This is in addition to the fact that it eliminates the need for salary negotiations that take place on an individual basis. Through the course of this piece, we are going to go into great depth on the Philippines Salary Increase 2024.

The Theory That Drives the Decision to Raise Salaries

Growth of the Economy and Price Increases

The persistent level of economic expansion in the Philippines is one of the key factors that has contributed to the rise in salaries in the nation. Despite the obstacles that have been faced on a global scale, the Philippine economy has shown resiliency and growth during the last several years.

Nevertheless, this expansion has also been accompanied by growing inflation, which has the effect of reducing the buying power of employers and employees. To lessen the effect of inflation and make certain that the advantages of economic development are spread fairly, the government and a variety of stakeholders have advocated for pay increases.

Advocating for a Living Wage

Advocating for a salary that allows people to make a livelihood is another important aspect. Since the beginning of time, labour unions and civil society organizations have been advocating for salaries that are in line with the actual cost of living.

They contend that the present minimum wage is not enough to meet their fundamental requirements, which include the provision of food, housing, education, and medical care. When people advocate for a living wage, they are not just trying to raise pay; they are also trying to make sure that workers can live dignified lives without having to worry about their finances.

The Daily Minimum Wage in the Philippines; Let’s dig into this

From the year 2023 to the year 2024, the minimum wage in the Philippines remained unchanged at 610 Philippine Pesos (PHP) a day. In addition, you should be aware that the minimum wage in the nation differs from province to province because of this. The minimum wage in the Philippines has climbed from 89 Philippine Pesos (PHP) per day in 1989 to 610.00 PHP per day in 2023, which is an all-time high. From 1989 to 2024, the daily wage averaged out to 354.32 Philippine Pesos.

Workers Salary Increase
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With a daily minimum salary of 505.23 Philippine pesos, Metro Manila, also known as the National Capital Region (NCR), has the highest real minimum wage in the Philippines as of January (2024). Immediately after that was Region IV-A, also known as CALABARZON, which had a minimum pay of 420.71 Philippine pesos per day.

By the issue of Wage Order No. IVA-19, on June 14, 2022, the provincial rate of daily minimum wages for the province of Calabarzon (Region IV-A) in the Philippines has been increased. For a typical workday that does not go over eight hours, the rise in the minimum wage applies to all workers in the private sector, regardless of their employment, position, designation, or the method by which they are paid their compensation.

What is the anticipated rise in salaries and the minimum wage in the Philippines?

It is anticipated that the median salary growth for Filipino workers will increase from 6% in 2023 to 6.2% in 2024 as a result of several major elements that influence the labour market. As an additional point of interest, businesses in the Philippines are still planning for a total median Salary Increase of 5.7% in the year 2024.

Ever since the outbreak occurred a few years ago, there has been a progressive growth in the average income over the years. Throughout this year, identical trends have been seen throughout the various sectors around the country. Most of the time, we can credit this to the increasing need for workers with high levels of qualification as well as the necessity of retaining top individuals in a highly competitive business. The continual pressures of inflation are another factor that has a substantial impact on this salary adjustment.

When compared to other industries, demand is stronger in some sectors. According to Mercer, the energy sector is considered to be the industry that is most likely to get the greatest pay boost, which is 7%. Other sectors, such as the retail and wholesale sector, the high technology sector, and the consumer goods sector, are not far behind, with growth projections of 6.8%, 6.7%, and 6.5%, respectively.

Expected increases in pay and benefits

Adjustments that are Sector-Specific

It is not a one-size-fits-all approach to the pay boost that will take place in 2024. Depending on the industry norms, profitability, and the particular issues that each sector is confronted with, different aspects of the economy will go through differing degrees of modification.

It is anticipated that traditional businesses like as agriculture and manufacturing may have lower percentage gains in comparison to areas such as information technology, business process outsourcing (BPO), and finance, which have been the pillars around which the Philippine economy has been built.

Differences Across Regions

Because of the archipelagic structure of the Philippines and the varying economic landscapes, there will be variations in pay increases throughout the country’s many regions. Given the higher cost of living and the more economic activities that take place in Metro Manila, it is anticipated that there will be more significant pay changes in comparison to other locations. On the other hand, efforts are being made to guarantee that even workers in places with a lower level of economic development would benefit from these developments.

Increases to the Minimum Wage

Recent Minimum Wage Rates in Effect

As of the year 2023, the average daily minimum wage in the Philippines ranges between PHP 316 to PHP 537, with considerable variations occurring throughout the country’s many regions. It is the Regional Tripartite Wages and Productivity Boards that are responsible for determining these rates. These boards take into consideration a variety of criteria, including the cost of living, employment rates, and economic situations.

Changing Proposals for the Year 2024

As of the year 2024, it is anticipated that the minimum wage will see a rise of roughly 10-15%. The purpose of this adjustment is to increase the gap between the salaries that are now being paid and the real expenses of living. There is a possibility that the minimum wage in Metro Manila would grow to around PHP 600 per day. At the same time, in other areas, the possible increases range from PHP 350 to PHP 450 per day, depending on the economic realities of such regions.

Employees may maximize their earnings by following these tips.

The Strategies of Negotiation

Employees may also consider sharpening their bargaining abilities in light of the projected rises in their salaries. To successfully negotiate pay, it is essential to have a solid understanding of industry norms, to be aware of one’s market worth, and to communicate one’s contributions to the organization properly.

Taking Advantage of Additional Abilities

In a highly competitive labour market, workers who possess extra abilities might differentiate themselves from their contemporaries. Employees may become more useful to their employers and boost their earning potential by investing in continual learning, which can be accomplished via formal schooling or through their participation in online courses.

The Closing Discussion

Southeast Asia has a long history of being a centre of economic development, which is one of the reasons why it attracts talented people from all over the globe. The dynamics of Salary Increases, employee turnover, and workforce stability become increasingly crucial as the threat of an imminent recession becomes more likely to occur. In current challenging times, companies need to manage human expenses and profitability, among other things, and increasing compensation alone is not a viable solution for them.

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From the perspective of Asia as a whole, the Salary Increase in the Philippines is remarkable since it is unprecedented. As they continue to expand, some businesses, such as the retail and consumer sector, the shared services and outsourcing sector, and the retail industry, will continue to hire more employees. Because this pattern is going to continue, it is quite likely that employers in the Philippines will continue to provide benefits in the year 2024 to attract and retain a large workforce.

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