BY MARCHEL P. ESPINA
There was a significant drop in the real wages of workers in the private sector in Western Visayas as a result of economic aftershock brought by the coronavirus pandemic, labor leader Wennie Sancho said yesterday.
Sancho, secretary-general of the General Alliance of Workers Associations, said the latest Regional Economic Profile released by the Philippine Statistics Authority showed that, as of August, the Consumer Price Index, that measures the changes in the price level of goods and services that most people buy, is at P125.7 which is higher than the P121.7 in 2019 while the inflation rate, which is the percentage change in CPI, is at 2.7 percent, from 2.4 percent last year.
The same data showed that the nominal wage or wage measured in the amount of money, which is currently P395 per day for commercial and industrial workers, was drastically reduced to P314.24 in terms of real wage, which is the actual purchasing power of the peso, posting a decrease of P80.78 per day or P2,100 per month, he explained.
The purchasing power of the peso is the equivalent value of goods and services that a peso could buy at current prices, he said, adding that continuous decline in the real value of minimum wage would impact on the loss of the workers’ purchasing power, he said.
“A lower value on the workers’ purchasing power denotes a diminished capacity of workers to have access to basic goods and services. This diminution of wages is detrimental to the economic survival of the workers and their families amid the pandemic,” he said.
To protect the purchasing power of the workers, government should control the inflation rather than reduce the already low standard of living afforded by the minimum wage, he said.
He added that a 10 percent erosion on the value of the purchasing power of the nominal wage can be used as a warning signal to the Regional Wage Board to review whether the prevailing minimum wage still serves its purpose of protecting the vulnerable workers from the vagaries of the market.*