KUALA LUMPUR: The Economy Ministry is working with the Human Resources Ministry to prepare policy options to be presented to the National Economic Action Council (NEAC), which will discuss the best strategy to increase people’s wages.
Economy Minister Rafizi Ramli said that for this purpose, engagement sessions will be held with key stakeholders, namely the government, employers and workers, to get the views of all parties.
"The details and mechanism of the final policy will be decided based on comprehensive considerations, including affordability and cost implications for the private sector, sequencing of implementation and mutual agreement between the government, employers and employees," he said in a statement today (July 13).
Rafizi was commenting on the statement by the Malaysian Employers Federation (MEF), which claimed that wage-related policies fall under the jurisdiction of the Human Resources Ministry, not the Economy Ministry.
Rafizi was reported to have said that the government hoped that the private sector will be committed to offering its cooperation so as to realise a policy of progressive wage increases to tackle the rising cost of living.
Rafizi said the Economy Ministry is responsible for the economic planning of the country as a whole, but as efforts continue to improve other economic structures, the ministry will also emphasise the aspect of raising wages that are fair to all parties.
He said wages that do not match the cost of living are the main issues hindering Malaysia's transition to a high-income economy.
The dependence on low-skilled labour is also one of the causes of wages that are not commensurate with the value of workers' income, he added.
"Malaysia's Compensation of Employees (CE) to Gross Domestic Product (GDP) ratio for 2019 is 35.9%, well below other developed countries such as Germany (59.4%), the United Kingdom (55.5%), Australia (46.9%) and the Republic of Korea (46.8%).
"The real median wages and entry-level wages have fallen after the pandemic and remain lower than before the pandemic," he said.
Rafizi said wage growth is also one of the main thrusts of structural reforms to achieve the CE target as set out in the 12th Malaysia Plan. - Bernama
