If you are a working professional in the Philippines, this article is quite beneficial for you. The year 2024 is poised to bring significant changes to the salary landscape in the country. With the upcoming implementation of the Salary Standardization Law of the Philippines, employees can expect notable adjustments to their wages.
This article delves into the details of the Philippines Salary Increase 2024, covering the minimum wage and the expected salary increases.
Philippines Salary Increase 2024
Employees in the Philippines have a reason to look forward to 2024 as they will soon experience a significant salary increase. The Salary Standardization Law of the Philippines, which sets annual salary revisions based on current trends, is responsible for these increases.
Budget planning for wage increases is still influenced by inflationary pressures and concerns about a competitive labor market. According to the proposed law, starting on January 1, 2024, and continuing yearly until 2027, the Department of Budget and Management (DBM) will create an amended four-tranche payment rise schedule.
This system aims to enhance employee responsibility and efficiency while eliminating the need for one-on-one wage discussions.
Philippines Daily Minimum Wage
The minimum wage in the Philippines has remained unchanged from 2023 to 2024, standing at 610 PHP per day. However, it is important to note that the minimum wage varies according to the province.
The minimum wage in the country has seen a steady increase over the years, rising from 89.00 PHP per day in 1989 to an all-time high of 610.00 PHP per day in 2023. From 1989 to 2024, the average daily wage has been 354.32 PHP.
Metro Manila, or the National Capital Region (NCR), boasts the highest real minimum wage as of January 2024, at 505.23 Philippine pesos per day. Following closely is Region IV-A, or CALABARZON, with a minimum wage of 420.71 Philippine pesos per day.
As per the June 14, 2022 publication of Wage Order No. IVA-19, the provincial rate of daily minimum wages for Calabarzon has been raised. This increase covers all private sector employees, regardless of job status, designation, or mode of salary payment, for a normal workday that does not exceed eight hours.
Expected Salary and Minimum Wage Increase in the Philippines
Several significant factors influencing the labor market are expected to cause the median wage growth for Filipino workers to rise from 6% in 2023 to 6.2% in 2024. Additionally, businesses in the Philippines are budgeting for a 5.7% total median wage rise in 2024.
Since the COVID-19 pandemic, the average income increase has been rising gradually. This year, similar patterns have been observed across various industries in the country. The growing need for highly qualified workers and the necessity to retain top talent in a competitive market can be attributed to these trends. Ongoing inflationary pressures also significantly influence this pay adjustment.
Demand is higher in some industries than in others. According to Mercer, the industry most likely to receive the largest pay increase—7%—is the energy sector. Other industries, such as consumer goods, retail and wholesale, and high tech, are not far behind, with predicted growth of 6.8%, 6.7%, and 6.5%, respectively.
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Final Discussion
Southeast Asia has historically been a hub of economic progress, drawing talent from around the world. As it faces the possibility of an impending recession, the dynamics of wage increases, employee turnover, and workforce stability become more crucial.
Increasing pay alone isn’t sustainable in these challenging times for businesses, which need to manage human costs and profitability among other factors.
Remarkably, in the larger Asian context, the pay rise in the Philippines stands out. Certain industries, including the shared services and outsourcing sector, retail, and consumer sector, will continue to hire as they grow.
Employers in the Philippines are likely to keep offering perks in 2024 to attract and retain a substantial workforce, as this trend is expected to continue.