Special considerations should also be given to small and medium enterprises in industries or regions most affected by the minimum wage increase to ensure their sustainability and competitiveness, according to Federation of Malaysian Manufacturers president Tan Sri Soh Thian Lai. (Photo by Patrick Goh/The Edge)
KUALA LUMPUR (Jan 31): With the impending new minimum wage of RM1,700 set to take effect nationwide from Saturday, the Federation of Malaysian Manufacturers (FMM) has urged the government to adopt a more targeted approach to implementing the minimum wage policy in the future.
In a statement on Friday, the FMM said it is concerned that the implementation of the new minimum wage may have an uneven impact across states and industries, citing varying economic conditions and costs of living between states and regions.
It noted the “one-size-fits-all” approach adopted could place additional strain on businesses, particularly small and medium enterprises (SMEs) in less developed areas.
“The FMM proposes that future wage adjustments consider state-based or regional models to reflect local economic realities more effectively, which is provided for in the National Wage Consultative Act 2011,” FMM president Tan Sri Soh Thian Lai said.
The FMM labelled the impending minimum wage increase as “substantial”, and noted that while well-intentioned, it will burden businesses, which the federation said are already grappling with rising operating costs, inflation and economic uncertainties.
Towards easing this projected burden, the FMM called for the government to cooperate closely with industry stakeholders in monitoring the minimum wage hike's impact, and provide transitional support measures.
The industry group suggested these potential measures to be in the form of tax incentives, grants or financial assistance for automation, and upskilling initiatives to ease compliance burdens and improve workforce productivity.
“Special considerations should also be given to SMEs in industries or regions most affected by the [minimum wage] increase to ensure their sustainability and competitiveness,” Soh added.
Related to this, the FMM called on the National Wages Consultative Council to further enhance stakeholder engagement, and conduct comprehensive studies on the socio-economic implications of future minimum wage policies.
“This will ensure that decisions are data-driven, and reflective of Malaysia’s diverse economic landscape,” said Soh.
The FMM said it remains committed to working alongside the government to ensure that wage policies are implemented successfully, balancing the needs of workers with the sustainability and competitiveness of businesses.
- Trump says Ukraine talks may be going OK, but there is a time 'to put up or shut up'
- Iran, US hold 'positive' talks in Oman, agree to resume next week
- Central banks prepare first G-7 responses to US chaos
- Apple, Nvidia score relief from US tariffs with exemptions
- Apple was on brink of crisis before tariff concession from Trump