PETALING JAYA: The temporary exemption from further minimum wage increases will give micro, small and medium-sized enterprises (MSMEs) much-needed breathing space as they grapple with rising operating costs, says SME Malaysia.
Its president Dr Chin Chee Seong said the decision would help MSMEs maintain business continuity, protect jobs and remain competitive while continuing to contribute to Malaysia’s economic growth.
“SME Malaysia supports the government’s continued efforts to improve workers’ wages and welcomes the use of the Progressive Wage Policy to provide wage subsidy support, enabling wage growth to be aligned with productivity improvements,” he said in a statement on Wednesday (Sept 30).
However, Chin said the government should further strengthen wage incentives and subsidies under the Progressive Wage Policy by increasing financial support, expanding its coverage and simplifying the application and approval process.
He said a simpler and more accessible mechanism would enable more MSMEs to benefit from the programme while progressively raising workers’ wages and managing the additional cost burden arising from wage adjustments.
“Improving workers’ wages and maintaining business competitiveness can be pursued together.
“A stronger wage subsidy and incentive mechanism would provide MSMEs with greater capacity to improve employee remuneration while investing in productivity enhancement, digitalisation, skills development and training,” he said.
Chin also welcomed the government’s continued engagement with the SME community, saying further dialogue was needed to develop a wage policy framework that balances workers’ income growth, business competitiveness and sustainable economic growth.
SME Malaysia will hold a joint press conference with the Malaysia Retail Chain Association on Friday to address the minimum wage issue and release findings from its “SMEAM Quick Business Survey: Minimum Wage Review 2026”.
The survey will provide insights into businesses’ operating cost pressures, their capacity to absorb further minimum wage adjustments and industry views on the government’s wage policies and support measures.
