The Real Cost of Cheap Household Help: Why ₱7,000/Month Workers Cost You More
The hidden math behind "bargain" household staff—and why saving ₱5,000 per month actually costs you ₱5,600 more
You thought you were saving ₱5,000 per month.
You're actually losing ₱5,600 per month
The ₱7,000 Promise
You see the post: "Experienced yaya, ₱7,000/month, available immediately."
It feels reasonable. You're not going rock-bottom cheap, but you're saving ₱5,000/month compared to agencies charging ₱12,000-15,000. Over a year, that's ₱60,000 in savings.
That ₱7,000 worker is paid the legal minimum wage in Metro Manila (NCR). While this meets the legal floor, it fails to meet the market price for professionalism.
Why this feels reasonable: You're following the law, the salary seems fair compared to other household staff, and you're not being exploitative. Many families hire at this rate. The worker accepts the offer. It makes sense on paper.
Here's what 16 years and 80,000+ placements taught us: That ₱7,000 worker will cost you closer to ₱18,500 per month once you factor in the hidden costs.
The ₱12,000 "expensive" professional? Actually costs ₱12,900 all-in.
This isn't about judging families on budgets. This is about showing you the math that most people only discover after the second or third failed hire.
The True Cost Formula
When you hire household staff, you're not just paying their salary. You're paying for:
| Cost Category | ₱7K "Cheap" Worker | ₱12K Professional |
|---|---|---|
| Base Salary | ₱7,000 | ₱12,000 |
| Turnover Cost | ₱2,000/month | ₱500/month |
| Supervision Time | ₱7,800/month | ₱200/month |
| Mistakes/Damages | ₱1,200/month | ₱200/month |
| Legal Risk | ₱500/month | ₱0 |
| TRUE MONTHLY COST | ₱18,500+ | ₱12,900 |
You "save" ₱5,000 on paper.
You LOSE ₱5,600/month in reality.
Over one year: ₱67,200 more expensive to go "cheap"
The shocking truth: The "cheap" option costs 43% MORE than the professional one.
Now let's break down each hidden cost.
Hidden Cost #1: The Turnover Tax
Why ₱7K Workers Leave After 6-8 Months
Real data from our industry:
- Workers earning ₱7-9K stay average 6-8 months
- Workers earning ₱12K+ stay average 18-24 months
What turnover actually costs you:
- Search time: 2-3 weeks finding replacement = ₱8,000 in your time at ₱500/hour
- Orientation: 2 weeks training = another ₱4,000
- Disruption: Family stress, kids upset, work missed = priceless
- Repeat cycle: Every 6-8 months you restart
Industry standard: Research from Gallup and the Center for American Progress shows that replacing any employee costs 0.5x to 2x their annual salary, with most studies converging on 1.5x-1.7x for hourly workers. We conservatively use a 1.7x multiplier.
₱7K workers: ₱12,000 search + training cost ÷ 6 months = ₱2,000/month ongoing turnover tax
₱12K professionals: ₱12,000 ÷ 24 months = ₱500/month turnover tax
Turnover difference: ₱1,500/month hidden cost
According to the Department of Labor and Employment (DOLE) and Philippine Statistics Authority (PSA) survey of 1.4 million domestic workers, only 2.5% have written employment contracts and 83% lack social security benefits—clear indicators of the informal, unstable employment that leads to high turnover.
Our observed pattern of 6-8 month tenure for minimum wage workers versus 18-24 months for professionally-placed staff aligns with broader labor market data showing that workers in informal arrangements have significantly higher turnover rates.
"I hired a ₱7,500 yaya thinking I was being smart—not too cheap, not too expensive. She lasted 7 months before leaving for a ₱10K offer elsewhere. By the time I factored in my time searching again, training her replacement, and the mistakes she made (ruined ₱4,000 worth of clothes with bleach), I realized I should have just paid ₱12,000 from day one."
Hidden Cost #2: The Supervision Tax
When You Pay Less, You Work More
Lower-wage workers often have:
- Minimal formal training
- No agency accountability
- Lower motivation (feeling undervalued)
What this costs you in constant supervision:
- Checking work quality: 30 min/day
- Correcting mistakes: 30 min/day
- Managing their issues: 1 hour/week
= 4 hours/week = 16 hours/month
Your time value: ₱500/hour (equivalent to a mid-level manager earning ₱80,000/month)
₱7K workers: 16 hours/month supervision needed × ₱500 = ₱8,000/month in lost work/leisure time
₱12K professionals: Minimal supervision (highly trained, agency-backed) = ₱200/month
Supervision cost difference: ₱7,800/month
Why professionals need less supervision:
- Come trained by the agency
- Have agency support if questions arise
- Higher intrinsic motivation (protecting their higher-paying position)
- Understand professional standards
Hidden Cost #3: The Mistake Tax
When Mistakes Add Up
Real costs from actual families who hired ₱7K workers:
Cooking mistakes:
- Ruined ingredients: ₱500-1,000/week
- Food poisoning (improper storage): Doctor visit ₱2,000
- Wasted groceries (no meal planning): ₱800/week
Childcare errors:
- Missed medicine timing: Emergency room visit ₱5,000
- Unsafe playground choices: Minor injury ₱1,500
- Forgot allergies: Hospital visit ₱3,000
Household damages:
- Bleach on colored clothes: ₱3,000 replacement
- Broken appliances (improper use): ₱2,000-8,000
- Damaged furniture: ₱1,500-5,000
₱7K workers: ₱1,200/month (based on our 2024 exit interview data from 100 families documenting household damages and food waste due to inexperience)
₱12K professionals: ₱200/month
Difference: ₱1,000/month in preventable mistakes
Why the difference?
- Professionals have agency training + ongoing accountability
- They know their mistakes reflect on the agency
- They're motivated to protect their higher-paying position
- They have better judgment from experience and training
Hidden Cost #4: The Legal Landmine
The ₱40,000 Penalty You Don't See Coming
Here's what most families hiring "cheap" workers skip:
- Proper SSS/PhilHealth/Pag-IBIG registration
- DOLE-compliant contracts
- Correct wage reporting
Why they skip it:
- They don't know the requirements exist
- The worker doesn't ask (fears losing the job)
- "Everyone hires this way"
- It feels like too much paperwork
The legal reality under Batas Kasambahay (R.A. 10361):
- Penalties: Up to ₱40,000 per violation
- SSS penalties for non-remittance: Back payments + interest + fines
- Potential labor cases if worker complains
Worker earning ₱7,000 gets sick. You didn't register them for PhilHealth.
- Hospital bill: ₱15,000 (you pay)
- PhilHealth would have covered: ₱10,000
- Your actual cost: ₱10,000 excess
- Plus: Legal exposure if they file a complaint
Professional agency route:
- Contract is DOLE-compliant from day one
- Clear documentation of all benefits
- Guidance on proper registration
- Your legal risk: Near zero
Legal exposure from non-compliance = ₱40,000 potential penalty
Even if risk is only 10% per year, that's ₱4,000/year = ₱333/month in "legal risk insurance" you're gambling without
We conservatively estimate ₱500/month for the true risk exposure
Learn more: Why Professional Agencies Check Both NBI and Police Clearances
Why Fair Wages Benefit You
This isn't charity. It's smart economics.
When you pay ₱12,000+ for a household professional:
1. They Stay Longer
- Average tenure: 18-24 months vs 6 months
- You build actual relationship with your family
- Kids get consistency and attachment
- Your routines stabilize
- No constant re-training cycles
2. They Perform Better
- Motivated to protect their position
- Take pride in their work
- Proactive rather than reactive
- Represent your household professionally
- Fewer mistakes = lower stress for everyone
3. They Refer Quality Friends
- Happy workers tell their network
- Your next hire is easier (built-in referrals)
- Built-in replacement if they need to leave for family reasons
4. You Sleep Better
- Know they're legally registered
- Have recourse through agency if issues arise
- Protected by guarantees and contracts
- Not exploiting anyone
Our approach:
- Starting salaries: ₱12,000+ (not charity, economics)
- Full SSS/PhilHealth/Pag-IBIG coverage from day one
- DOLE-compliant contracts provided
- Ongoing agency support and accountability
Result: 70% of our placements last 18+ months
Industry average (₱7-9K workers): 6-8 months
Read our philosophy: Why We Fight for Fair Wages for Household Professionals
How to Hire Smart, Not Cheap
Three Questions Before You Hire:
1. "Can I afford the true cost?"
Don't just look at monthly salary. Add:
- Turnover costs (₱2,000/month for ₱7K workers)
- Your supervision time (₱7,800/month value for ₱7K workers)
- Potential mistakes (₱1,200/month average)
- Legal compliance risk (₱500/month exposure)
If you can't afford a professional wage (₱12K+), consider:
- Part-time help instead of full-time
- Task-specific workers (cleaning only, no childcare)
- Delayed hire until budget allows
2. "Am I getting what I pay for?"
Red flags in "cheap" offers:
- No medical screening mentioned
- No agency backing or guarantee
- "Experience" with no verification
- Immediate availability (no vetting time needed)
- Cash only, no receipts or documentation
Green flags in professional placement:
- Clear screening process (5-10 days minimum)
- Medical + dual background verification (NBI + Police)
- Agency replacement guarantee in writing
- DOLE-compliant contracts provided
- Physical office address and DOLE license
3. "What's my exit strategy?"
If this hire fails:
- Can I afford to restart the search? (₱8,000+ cost)
- How will I cover the childcare/household gap?
- What did this failed hire actually cost me in total?
Professional route: Agency handles replacement, you stay covered
DIY route: You're on your own, starting from zero
People Also Ask About Household Help Costs
What is the legal minimum wage for domestic workers in Metro Manila?
₱7,000 per month is the legal minimum wage in Metro Manila (NCR) for domestic workers under Batas Kasambahay (Republic Act 10361). This wage must be paid in addition to benefits including SSS, PhilHealth, and Pag-IBIG contributions.
How long do household workers typically stay with one family?
According to our 16 years of placement data, workers earning minimum wage (₱7-9K) stay an average of 6-8 months, while professionally-placed workers earning ₱12K+ stay 18-24 months. This 3x difference in tenure is the primary driver of hidden turnover costs.
What are the hidden costs of hiring household help?
The four major hidden costs are: (1) Turnover tax from frequent replacements (₱2,000/month), (2) Supervision tax from your time managing undertrained workers (₱7,800/month), (3) Mistake tax from damages and errors (₱1,200/month), and (4) Legal risk from non-compliance with Batas Kasambahay (₱500/month).
Is ₱12,000 too much to pay a yaya in Manila?
No. While ₱12,000 is 71% higher than minimum wage, the true monthly cost is actually ₱12,900—which is 32% less than the ₱18,500 true cost of a ₱7,000 minimum wage worker. You save ₱5,600 per month (₱67,200 per year) by paying professional wages.
What happens if I don't comply with Batas Kasambahay?
Employers who fail to comply with Batas Kasambahay requirements (proper contracts, SSS/PhilHealth/Pag-IBIG registration, rest days, overtime pay) face DOLE penalties up to ₱40,000 per violation. According to DOLE/PSA data, 83% of domestic workers lack social security benefits, indicating widespread non-compliance.
When does hiring "cheap" household help make sense?
Lower wages can work for part-time, hourly help (2-3 hours/week), specific tasks only (laundry or cleaning), or temporary coverage when your regular helper is on leave. However, "cheap" never works for full-time live-in care, childcare responsibilities, elder care duties, or any role requiring trust and consistency—the stakes are too high and the risks too big.
Ready to Save ₱67,200/Year?
Stop losing money on "cheap" help. Get professionals who actually cost less.