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Job generation better than pay hike — economist

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President Benigno S. Aquino III, accompanied by Labor and Employment Secretary Rosalinda Dimapilis-Baldoz, arrives for the Pre-Labor Day Dialogue at the Heroes Hall of the Malacañan Palace on Tuesday (April 30). The conduct of Pre-Labor Day Dialogue is pursuant to the 22-point Labor and Employment Agenda of President Aquino, which essentially consists of among others, the following directives: promote not only the constitutionally protected rights of workers but also their right to participate in the policymaking process; and work with the private and labor sector to strengthen tripartite cooperation and promote industrial peace. (MNS photo)

President Benigno S. Aquino III, accompanied by Labor and Employment Secretary Rosalinda Dimapilis-Baldoz, arrives for the Pre-Labor Day Dialogue at the Heroes Hall of the Malacañan Palace on Tuesday (April 30). The conduct of Pre-Labor Day Dialogue is pursuant to the 22-point Labor and Employment Agenda of President Aquino, which essentially consists of among others, the following directives: promote not only the constitutionally protected rights of workers but also their right to participate in the policymaking process; and work with the private and labor sector to strengthen tripartite cooperation and promote industrial peace. (MNS photo)

MANILA, May 1 (Mabuhay) -– A private economist on Wednesday said it is more important for the government to create more jobs than to hike salaries because higher wages will discourage foreign investments.

Dr. Ernesto Pernia of the University of the Philippines School of Economics said the minimum wage rate in the Philippines is already one of the highest in Asia.

He said any wage increase should be accompanied by an increase in workers’ productivity.

“Mahirap kasi kung magtaas ka ng sweldo palagi…hindi tayo maka-attract ng investors, foreign investors or local investors,” he said.

Pernia said an increase in productivity would lower inflation and increase real purchasing power of labor groups. He also said palliatives such as nonwage benefits are not the solution.

“Para sa ekonomista, mas importante na magkaroon ng employment opportunities. Lalago ang investment at ekonomiya. Dadami ang trabaho,” he said.

The UP professor said he supports government’s plan to launch an agro-industrial program in the last quarter of the year. He also said the Aquino administration’s potential to improve the labor situation is better compared to the previous administration.

“It is not the rate of economic growth that is important but the quality of economic growth, the structure. Dapat ang sources of economic growth should come from agriculture, manufacturing, not from services or [business process outsourcing]. That’s on the supply side. On the demand side, dapat hindi lang consumption. Dapat investment rin ang driver ng economic growth,” he said.

For his part, Alan Tanjusay of the Trade Union Congress of the Philippines said the country only has the third highest minimum wage rate in the ASEAN. He said one problem faced by the country is high electricity rates, which affects both employers and workers and deters investors.

Negotiated pay hikes

Meanwhile, former Labor Secretary Patricia Santo Tomas said trade unions should negotiate with specific companies for salary hikes instead of seeking across-the-board wage increases from government.

Santo Tomas said it is time to replace the traditional methods of seeking salary adjustments because companies have different financial situations.

She also said the relationship between management and laborers in a particular company should come into play in the internal discussions for wage increases.

She also said government should prioritize the industrialization of the agricultural sector over employment issues in urban centers. (MNS)

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