Are we paying our workers enough?

Office workers are silhouetted against a sunlit wall as they chat and walk in the shadow in Tokyo. Real wages in Japan in June fell 3.8% from a year earlier, following the same pace of decline logged in May - EPA Photo.

HOW much should our workers be paid? This issue has long been debated by our lawmakers as well as our institutions, which include Bank Negara in its latest 2018 annual report and the highly respected Khazanah Research Institute (KRI).

According to Bank Negara, the labour share of income, despite having risen from 31.7% in 2010 to 35.2% of GDP in 2017, still lags behind most advanced economies, which implies that a larger fraction of national income in Malaysia goes to capital owners rather than workers.