A consumer purchases an item in a store in Carbon Public Market in Cebu City. | CDN Digital File Photo by Niña Mae Oliverio
CEBU CITY, Philippines — The new wage hike in Central Visayas may have an impact on how consumers spend their wage on necessities.
Wage Order No. ROVII-2, published on September 16, 2024, provides for an increase of P33 to P43 per day in Region VII, including the Negros Island Region (NIR).
From a daily wage of P468 in the formal sector and P458 in the agricultural and non-agricultural sectors with fewer than 10 workers in Class A cities and municipalities, the new daily minimum wage is now P501.
Class A cities and municipalities includes the cities of Carcar, Cebu, Danao, Lapu-Lapu, Mandaue, Naga, and Talisay, as well as the municipalities of Compostela, Consolacion, Cordova, Liloan, Minglanilla, and San Fernando, collectively known as Expanded Metro Cebu.
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Meanwhile, for Class B cities and municipalities, the daily wage has increased from P425 to P430 to a new minimum of P463. Class B includes cities not classified under Class A, such as Bais, Bayawan, Bogo, Canlaon, Dumaguete, Guihulngan, Tagbilaran, Tanjay, and Toledo.
For Class C municipalities, which cover areas not included in Classes A or B, the daily wage has risen from P415 to P420 to a new minimum of P453.
Perception of consumer and trader
With this increase, Chief Statistical Specialist of the Philippine Statistics Authority (PSA) Cebu, Melchor Bautista said that though the consumers always have perceptions on what to buy, depending on their money on hand, some may think that they can buy more.
“They would say, I have a lot of money, so I can buy a lot of things,” he said in Cebuano.
But on the other hand, the trader also has his perception that he needs to have more supplies because the consumers have a lot of money to buy their products, Bautista added.
“Meaning to say, nga kung ang perception sa consumer ug trader, labi na magka-opposite kay dili ka supply ang mga trader,” Bautista said.
He added that the tendency is that if the consumer thinks that he can buy more items or products, the traders would think about the number of supplies he can provide.
If the supplies are not enough, that would be the time that the trader would increase their prices, Bautista said.
“Mao na siya bantayan nato kinahanglan mag match ang perception sa consumer ug sa traders,” Bautista added.
PSA-7 Chief Statistical Specialist, Engr. Felixberto Sato Jr. also said the same.
“Mas daghan mapalit ang mga tawo basin makapalit pod unya sa supply…Modako ang demand, mas makapalit na sila, karon, ang supply pod mo baba,” Sato said.
But Sato said that the immediate effect of the wage increase will not be felt immediately.
Sato assured that as long as the headline inflation in the region falls between the projection of the Central Bank (Bangko Sentral ng Pilipinas), which is between 2 and 4 percent for 2024-2028, it will not be a matter of concern.
The BSP said that the inflation range is a ‘quantitative representation of the medium-term goal of price stability, aligned with the current structure of the Philippine economy and the outlook on macroeconomic conditions over the next few years.’
The impact of wage increase to customer spending was included in the discussion during PSA Cebu and Region 7’s inflation dissemination report for September 2024. | with reports from Futch Anthony Inso