Joint communiqué aims to improve competitiveness

By Max V. de Leon
Published on the November 14, 2006 issue of the BusinessMirror

DIFFERENT labor and industry groups will be forging a joint communiqué that is targeted at harnessing the employee-employer relations and addressing the country’s labor-cost competitiveness.

A team composed of representatives from the Federation of Philippine Industries (FPI), Fair Trade Alliance (FTA), the Federation of Free Workers and the University of the Philippines School of Labor and Industrial Relations (UP-Solair), among others, are now drafting the contents of the communiqué.

To be known as the Joint Communique on Decent Work, Productivity and Competitiveness, the document is expected to be signed by the heads of industry groups and labor organization on November 28.

Dean Jorge Sibal of UP-Solair said with the advent of globalization, it has become imperative for the domestic labor and capital to harness their complementary traits and work together in resolving their inherent differences to continue meeting competition from the outside.

The communiqué, Sibal said, will soon evolve into a big movement that will collectively tackle issues both on the macro side, which are the government policies, and the internal side, or the ways to promote industrial peace in the workplace.

The representatives of the different sectors will be meeting again at least twice this month to concretize the content of the communiqué before it is signed.

Sibal said one big factor why labor cost is high in the Philippines is the high inflation rate that makes the cost of living here also relatively more expensive than countries like Vietnam and China.

Sibal said high inflation rate is largely caused by the government’s decision to reduce state subsidies in basic services like housing and food.

With this, workers would need bigger wages to cope with their rising expenses, and would subsequently force their employers to raise their take-home pay.

“The reason why Vietnam and China have lower labor cost is because the cost of living there is still low because of government subsidies,” Sibal said.

Rene Ofreneo, cofounder of the FTA, said another way to go around the high labor cost is to raise the productivity level of the Filipino workers.

Through this, Ofreneo said, the country will continue to be competitive even if companies would have to pay the workers higher salaries compared with those in other countries.

Meneleo Carlos, FPI chairman, said they are hoping that over time, the movement will become bigger so that, its initiatives would be treated as national policies.

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