As Congress convenes a hearing on wage bills, including the Living Wage Bill of the Makabayan bloc, research group IBON stressed that a wage hike, particularly towards a living wage, is more urgent than ever. Filipino workers’ already meager wages are failing to keep up with rising prices—now further worsened by the ongoing Middle East conflict—hitting many families hard and pushing more into poverty.
IBON pointed out that the global oil price shock triggered by the US attack on Iran in February has driven faster inflation in the Philippines, raising the cost of fuel as well as basic goods, services and utilities. Inflation not only reached a 3-year high but also posted its sharpest two-month spike since the 1990s—surging by 4.8 percentage points from 2.4% in February to 7.2% in April 2026.
With wages unable to keep pace, more households are experiencing economic hardship. IBON estimates that, nationwide, the average nominal minimum wage of Php510 is only 39% of the Php1,312 family living wage (FLW) for five members as of April 2026 at the peak of high inflation—leaving a wage gap of Php802. This gap barely lowered to Php795 in May 2026. Around 65% of Filipino families (17.9 million) live on less than the April FLW level.
The group added that regional minimum wages are effectively family poverty wages. For a family of five, the average daily minimum wage translates to just Php78 per person, far below the official poverty threshold of Php91 per person. According to Social Weather Stations (SWS), 52% of Filipino families considered themselves poor as of March 2026—much higher than the 42.8% reported at the start of the Marcos administration in 2022.
Beyond immediate relief, IBON underscored that giving workers a living wage is also just. Minimum wages have lagged behind worker productivity for over three decades. From 1989 to 2025, worker productivity has doubled by 104%, yet the real value of the minimum wage fell by 14 percent. Raising the average nominal minimum wage to Php1,240 would align wages with productivity growth over that period.
At the same time, corporate profits and individual wealth has surged. From 2020 to 2022, net income of the top 1,000 corporations grew by 104%, and by 59% across all establishments. The net worth of the 50 richest Filipinos also rose by 31 percent. In stark contrast, the average nominal minimum wage increased by a negligible 11%—from Php364 to Php404.
IBON maintained that substantial wage increases can be both affordable and doable, especially if small firms are given government support and large firms are willing to take a cut in their already huge profits. Compensation, including wages, account for only about 11% of expenses among formal sector establishments. The group estimates that a Php100 across-the-board (ATB) wage hike will take up 6.3% of profits for MSME (micro, small and medium enterprises) and 5.6% for large firms. A Php542 ATB increase—enough to reach a Php1,200 FLW—will take up 34% of MSME profits and 30.1% of large firms’ profits. To support smaller businesses, IBON proposed strong government measures such as cheap credit, tax relief, wage subsidies, and productivity assistance.
IBON said that raising wages to a living level is not only urgent, just and doable but entirely essential for workers and their families, and vital for the national economy. The economic grounds are clear and all that is needed is the political choice by Congress in favor of workers, Filipinos and national development.
