More details on progressive wage model needed, says MCA Youth vice chairman

  • Letters
  • Monday, 27 Nov 2023

PETALING JAYA: The government must also look at solutions for employees and businesses in tandem with the Progressive Wage Model (PWM) to help the country's economic situation, says Jacob Lee Yen Yuan.

In a press statement on Monday (Nov 27), the MCA Youth vice chairman said that increasing wages, which are low in the first place, without giving businesses more room to grow, would only raise operating costs and result in more issues.

He also said that apart from the increase in minimum wage, little is known about the PWM and unless the government shares more details, employees and businesses would be left flat-footed when the White Paper on the PWM is tabled in Parliament.

His full statement is as follows:

Progressive Wage Model lacks details; Revitalising economy crucial

Details are required on the Progressive Wage Model (PWM) which Economy 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 raised from RM900 to RM1,500, salary increases have not been able to keep pace with price hikes. In fact, the (average) household income in the country needs much enhancement. However, it remains uncertain if the implementation of the PWM will likewise result with productivity improvements.

Although the government hopes to resolve the dilemma of slow wage growth by implementing 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 a low-skilled labour force, reliance on foreign workers and unemployment and unemployability of fresh graduates who do not match market demands will not be fixed with 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 Economy Minister does not seem able to grasp the key points and appears to spend too little time helping our country's economic situation 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 heightens 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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