Filipino white-collar workers feel the price hikes


PEOPLE go to a restaurant in a mall in Quezon City. — PHILIPPINE STAR / MIGUEL DE GUZMAN

By Kyle Aristophere T. Atienza, Journalist

THE FLYING IN FOOD AND FUEL PRICES is now forcing many Filipino white-collar workers to cut back on non-essential spending, which some experts say could affect businesses focused on leisure and recreational services.

Marhiel Sofia D. Garrote, a 24-year-old content writer for a lifestyle magazine, recently ended her subscriptions to some digital platforms and reduced her purchases of milk tea and coffee drinks.

“I even had to stop my subscription to a video streaming platform for a while,” she said in a Messenger chat.

John (pseudonym), who works for a research center, said he had reduced the use of Transport Network Vehicle Services (TNVS) and stopped buying collectibles, such as action figures. action and vinyl records.

“I started eating cheaper meals with less quality and avoiding afternoon snacks just to lessen the impact of rising commodity prices,” he said. in a Messenger chat.

Inflation is the most pressing national concern that President Ferdinand R. Marcos, Jr. should prioritize, according to 57% of Filipinos polled by Pulse Asia June 24-27.

(Related article: Rising prices are top concern for Filipinos — Pulse Asia)

Inflation hit its highest level in nearly four years, driven by rising prices for food, transport and utilities. The consumer price index reached 6.1% year-on-year in June, bringing the average to 4.4% in the first half.

“Rising commodity prices will temper demand for leisure services during this period of recovery and revenge spending compared to last year,” Commerce Secretary Alfredo E. Pascual said. Business world through Viber.

The middle class would be affected, he said, noting that food and non-alcoholic beverages make up 36.2% of an average Filipino household’s total expenditure, according to data from the Philippine Statistics Authority (PSA). . Restaurants and hotels account for 20.4% of total household spending, while transportation accounts for 16.5%.

In June, food inflation rose 6%, while transport jumped 17.1% and restaurants and hotels rose 2.8%.

“Rising food and transport prices should trigger a temporary reduction in leisure spending,” Pascual said.

Antonio A. Ligon, a business professor at De La Salle University, said a signiIfA drop in demand for non-essential services, including recreational activities, is not expected as “many will resort to caution” in these difficult times.

Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said consumers would cut non-essential spending if food, oil and electricity prices continue to rise.

“Anything left over after these will generally go to hobbies and recreation and other less essential expenses,” Ricafort said in a Viber message.

Inflation is expected to remain high over the coming months, the Bangko Sentral ng Pilipinas (BSP) said, “due to the continued rise in global commodity prices and more pronounced second-round effects on domestic goods and services. “.

The BSP now sees an average inflation of 5% this year.

“As the prices of basic goods and services rise, discretionary income is affected and, as a result, significant reductions in spending on non-essential goods like travel and leisure are occurring,” said Benvenuto N. Icamina, vice president and chief operating officer of the Wallace Business Forum.

Mr. Icamina noted that people with higher incomes could also moderate their spending on luxury goods and travel.

“For the highest income brackets, purchases of high-end goods, fine dining and vacations will be reduced as they reallocate more funds to maintain spending on essentials like education, health care, housing, among others,” he said.

For example, soaring prices at the pump prompted some Filipinos to reduce car use in an effor to save money. Since the beginning of the year, gasoline prices have increased by 24.30 pesos per liter and 36.80 pesos per liter for diesel.

“They Ifand their excess funds are dwindling, especially since the recovery has only just begun and many businesses still cannotfforder to give them suffieffective salary adjustments,” Mr. Icamina said.

DTI’s Mr Pascual said they would continue to monitor the prices of basic necessities to protect consumers and prevent hoarding and anti-competitive practices, which “could lead to further price increases”.

He said the Commerce Department would also make more loans on favorable terms to affected companies in the leisure industry.

“DTI continues to work with other agencies and the private sector to address gaps in our supply chain and logistics system,” Pascual said.

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