Fuel, forex pressures force firms into tightening belts

MANUFACTURERS and local businesses are tightening their belts as rising fuel costs and a weaker peso begin to weigh on operations, a Federation of Philippine Industries (FPI) head said.

- BY BLESS AUBREY OGERIO

FPI chairman Elizabeth Lee said that companies are now focusing on cost-cutting and efficiency measures to manage mounting expenses.

“Actually, it’s really being more efficient,” Lee told reporters on the sidelines of the industry's event in Taguig on Thursday. “Some of the basic things would be if there's no need for, let's say, for example, travel, then you would actually postpone your travel. But really, to conservation.”

She said firms are closely managing electricity and fuel use as input costs rise, while some are adopting measures such as carpooling and adjusting worker arrangements to reduce transport expenses.

Yet, the FPI chair was confident that manufacturers have sufficient inventories and can continue operating, noting that production cycles in the sector are typically long-term.

“Tightening your belt in terms of efficiencies—we have no choice. We have to do it right now. But it’s not letting go of people,” Lee said.

“It’s not something like if there is a spike in oil prices, you're going to shut down or close your factory. It doesn’t work that way. There are some mitigating factors that we can do,” she added.

Workweek tweaks

COMPANIES, meanwhile, are exploring shorter workweeks and more flexible arrangements as part of early responses to rising costs and global uncertainties, according to the Management Association of the Philippines (MAP).

According to MAP President Donald Lim, discussions within the private sector have begun around adopting hybrid arrangements, such as three to four days onsite work and one to two days remote, but he emphasized that any shift would be driven by the private sector.