Progressive wage policy is timely

THE government is expected to pilot its progressive wage policy programme this June. Aimed at increasing employee wages in parallel with productivity, this incentive-driven, voluntary opt-in programme has received mixed reactions. Workers have welcomed the move while employers have remained sceptical.

Most experts agree that wages must rise to improve the quality of life (especially among the B40 lower income group) and reduce socio-economic inequalities. Research by the Khazanah Research Institute and the Centre for Future Labour Market Studies suggests that higher wages can have a positive effect on the economy, for example, by raising productivity, addressing the brain drain, supporting Malaysia’s attempts to become a high-income nation, and encouraging upskilling.