MANILA -- Between 40,000 and 140,000 workers are expected to lose their jobs after the P35 daily wage hike is implemented in the National Capital Region this month, the head of the National Economic and Development Authority (NEDA) said on Tuesday.

While several employers may be unable to retain all their workers with the new wage adjustment, there are still some 600,000 available jobs for affected individuals to choose from, Socioeconomic Secretary Arsenio Balisacan said in a press briefing in Malacañang.

“The national output GDP (gross domestic product) would be impacted negatively, [but] just one-tenth of one percent. It is very negligible,” Balisacan said. 

“It could increase [the] unemployment rate but it is a negligible number,” he said.

“For so long as the economy is expanding because of investments coming in, the offsets will be there that’s why the economy can still grow,” he added.

The Regional Tripartite Wages and Productivity Board in the National Capital Region (RTWPB-NCR) earlier approved increasing the minimum wage by P35 per day, pushing the daily wage in Metro Manila to P645 for non-agriculture private sector workers and P608 for those working in agriculture, service, or retail establishments.

The rate adjustment is expected to begin on July 17.

The economic manager is confident that these workers who may lose their jobs would not significantly dent the Philippines’ recent 4.3 percent unemployment rate.

Unemployment rate edges up in May, underemployment dips

While some agencies reported a 0.1 percent increase in unemployment between April and May 2024, the number of Filipinos without work actually dropped if compared on a year-on-year basis, Balisacan said.

The Philippines’ unemployment rate dropped to 4.1 percent in May 2024 compared to the 4.3 percent [rate] in 2023, the NEDA chief said, noting that the current unemployment number is “already very low, even compared to more mature, more developed economies.”

The expansion of several sectors such as manufacturing and services yielded some 605,000 new jobs, he said.

“Levels of adjustment are quite reasonable. They are not really that constraining when it comes to the economy,” he said.

“For so long as the wage adjustment is not too high to discourage investments, the investments will come,” he said.

“If you lose one job there, there are other jobs being opened up,” he added.

The Department of Labor and Employment (DOLE) will “continue to monitor the possible effects and impacts of the wage adjustment,” Labor Secretary Bienvenido Laguesma said.

“From the very start, the direction really is how we can have more productive, more remunerative jobs,” he said.

The underemployment rate — which has been reduced to 9.9 percent from 11.7 percent — indicates that the “quality of jobs are encouraging,” he said.

The government has also been keen on “reducing the cost of doing business” in the country, he said.