For professionals working in the Philippines, this article offers crucial insights into the projected salary increases and minimum wage adjustments set for 2024.
Salary Increase in the Philippines for 2024
In 2024, employees in the Philippines can expect a notable salary increase, largely driven by the Salary Standardization Law (SSL). This law mandates annual wage adjustments in response to current economic trends. Inflation and competition in the labor market are key factors influencing these changes.
Starting from January 1, 2024, the Department of Budget and Management (DBM) will implement a revised four-stage salary increase plan, which will continue through 2027.
This system is designed not only to eliminate the need for individual salary negotiations but also to enhance employee performance and accountability. The following sections will cover these changes in more detail.
Current Minimum Wage in the Philippines
The Philippines’ minimum daily wage has remained steady at 610 PHP from 2023 to 2024. However, minimum wage rates vary by region. The minimum wage has gradually risen over the years, from 89 PHP in 1989 to a high of 610 PHP in 2023, with an average wage of 354.32 PHP over the period from 1989 to 2024.
As of January 2024, Metro Manila (NCR) has the highest minimum wage at 505.23 PHP per day, followed by Region IV-A (CALABARZON) with a minimum wage of 420.71 PHP per day. According to Wage Order No. IVA-19, published on June 14, 2022, the minimum wage for Region IV-A was adjusted, ensuring that all private sector workers employed for up to eight hours are included.
Expected Wage and Salary Growth in 2024
Several factors are expected to contribute to salary increases in the Philippines in 2024. The median wage growth is forecasted to rise from 6% in 2023 to 6.2% in 2024. Companies in the Philippines are also budgeting for a 5.7% overall wage increase for 2024.
Since the COVID-19 pandemic, wages have been rising across many industries, driven by the growing need for skilled professionals and the importance of retaining top talent in a highly competitive environment. Inflationary pressures are another key factor driving these salary adjustments.
Industry-Specific Salary Increases
Certain industries are projected to experience more significant wage growth than others. Research from Mercer indicates that the energy sector may see the highest salary increase, around 7%. Other sectors, including consumer goods, retail, and technology, are expected to see growth rates of 6.8%, 6.7%, and 6.5%, respectively.
Conclusion
Due to its economic growth, the Philippines remains a key destination for global talent. However, with potential economic challenges on the horizon, wage increases, employee retention, and workforce stability are becoming more crucial. Balancing wage growth with profitability is essential for companies aiming to remain competitive while managing costs.
Despite these challenges, the Philippines stands out in Asia for its distinct wage trends. Industries such as outsourcing, retail, and shared services are expected to continue hiring, with employers likely to offer attractive incentives to retain and attract talent.
Thank you for reading this update on the Philippines’ salary increase for 2024. Be sure to check back for more information and updates.
Click here to know more.
