For working professionals in the Philippines, 2024 holds promising news, as significant changes to salary and minimum wage levels are expected.
Thanks to the Salary Standardization Law, which annually revises wages based on trends and economic conditions, Filipino workers are likely to see salary adjustments starting January 1, 2024.
This article provides an overview of the expected salary increases, minimum wage updates, and key factors influencing these changes in the Philippines.
Overview of the 2024 Salary Increase
The Salary Standardization Law plays a critical role in determining wage hikes for employees in the Philippines.
The law mandates annual salary increases, with a focus on addressing inflationary pressures, competitiveness in the labor market, and economic growth.
In 2024, the Department of Budget and Management (DBM) will implement a four-tranche payment rise schedule from 2024 to 2027, aimed at raising wages progressively over the next few years.
These adjustments are not just about financial benefits but also about improving employee accountability and efficiency. By setting clear schedules for salary hikes, the system eliminates the need for one-on-one wage negotiations and streamlines the process.
Philippines Daily Minimum Wage
As of 2024, the minimum wage in the Philippines remains unchanged from 2023, standing at 610 PHP per day. However, it’s important to note that the minimum wage varies by region. Here’s a breakdown of the minimum wages in different regions:
- Metro Manila (NCR): The highest real minimum wage at 505.23 PHP per day.
- Region IV-A (CALABARZON): Next in line, with a minimum wage of 420.71 PHP per day.
Since June 2022, there has been a wage increase in Calabarzon (Region IV-A) under Wage Order No. IVA-19, raising minimum wages for all private sector employees. This increase applies to regular workdays not exceeding eight hours, ensuring fair compensation across the region.
Historically, minimum wages have risen significantly, from 89 PHP/day in 1989 to 610 PHP/day in 2023. Over the last three decades, the average daily wage has been around 354.32 PHP.
Expected Salary and Minimum Wage Increase for 2024
In 2024, median wage growth in the Philippines is projected to rise to 6.2%, up from 6% in 2023. This increase reflects several key factors, including:
- Rising demand for skilled workers across various sectors.
- The need for companies to retain top talent in an increasingly competitive market.
- Inflationary pressures, which have significantly impacted the cost of living.
Companies are planning for a 5.7% median wage increase in 2024. Since the COVID-19 pandemic, salary growth has gradually increased, with specific industries seeing higher-than-average wage hikes. According to Mercer, the following sectors are likely to see the largest pay raises in 2024:
- Energy Sector: Projected wage increase of 7%.
- Consumer Goods and Retail: Expected growth of 6.8%.
- High Tech: Anticipated increase of 6.5%.
These increases are driven by the rising need for expertise in these fields, coupled with companies’ efforts to remain competitive by offering attractive pay packages.
As the Philippines continues to experience economic growth, the 2024 salary increase is a crucial step in keeping wages aligned with inflation and market demands.
Employers will need to balance competitive wages with managing their human costs effectively to maintain profitability. In addition to salary adjustments, other benefits are expected to play a critical role in attracting and retaining a skilled workforce.
Overall, while the Philippines’ salary increase in 2024 will vary across industries, sectors like shared services, outsourcing, and retail are likely to see continued hiring and wage growth. Employers will also continue to offer perks and benefits to keep their workforce motivated and engaged.
For professionals and businesses, staying informed about the latest wage trends is essential to navigating the evolving labor market in the Philippines.
Keep checking back for more updates on the Philippines’ salary increases and other economic developments.
FAQs
When will the salary increases take effect in 2024?
The salary increases are expected to take effect starting January 1, 2024 and will continue annually through 2027.
What is the current minimum wage in Metro Manila (NCR)?
As of 2024, the minimum wage in Metro Manila (NCR) is 505.23 PHP per day.
Which industry is expected to see the highest salary increase in 2024?
The energy sector is projected to see the highest salary increase in 2024, with an estimated rise of 7%.
What factors are driving the wage increases in the Philippines?
Wage increases are being driven by inflation, a competitive labor market, and the demand for skilled workers across various sectors.
Are all workers eligible for the minimum wage increase?
Yes, all private sector employees, regardless of job status or designation, are covered by the minimum wage increase for a normal workday that does not exceed eight hours.
