Progressive wage model lacks details, not feasible in current economy

  • Letters
  • Tuesday, 28 Nov 2023

Details are required on the Progressive wage model (PWM) which Economic Minister Rafizi Ramli proposes to implement as employers and businesses remain in the dark on its execution, for example, how the PWM may affect operating costs or how the government would ensure that employee productivity increases.

As the minister plans to table a White Paper on the implementation of the PWM in Parliament by the end of this month, many employers and business groups have expressed their concerns as the PWM’s details have yet to be made public.

Other than employers, employees have shown little interest in the PWM.

Despite minimum wage having been raised from RM900 to RM1,500, these salary increases have not been able to keep pace with price hikes. In fact, the household incomes in the country in generally needs much enhancement.

However, it remains uncertain if the implementation of the PWM will likewise result with productivity improvements in tandem.

Although the government hopes to resolve the dilemma of slow wage growth by implementing a PWM, and seeks to introduce a system that connects wages with the level and skills of employees, adopting a PWM is not feasible. Issues plaguing our nation like low-skilled labour, reliance on foreign workers and unemployment and unemployability of fresh graduates whose studies do not match market demands will not be fixed with the execution of the PWM.

Our country’s current economic situation does not look optimistic: Prices continue to surge while climbing loan repayments have reduced the disposable income of the rakyat.

Unfortunately, our Economic Minister does not seem able to grasp the key points and appears to spend too little time on helping our country’s economic situation to recover. Neither has he introduced policies to stimulate domestic business growth and enhance the public’s daily living needs.

If the government is not able to assist the corporate sector to have sufficient room for development or to reap profits, but instead, formulate policies which heighten the operating costs of employers and businesses, such moves will only hurt Malaysia’s competitiveness and cause our nation’s reputation and advantage as a foreign investment destination to dwindle.

Jacob Lee Yee Yuan

MCA Youth vice-chairman

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