KUALA LUMPUR: The government must look into the limited prospects for growth for Malaysian workers entering the job market with low salaries, says an economist.
Centre for Market Education chief executive officer Carmelo Ferlito said this was a bigger issue than the minimum wage which affected foreign workers more than Malaysians.
"If we look at the data from the Department of Statistics Malaysia (DoSM) which aggregated household income, those earning RM2,000 or less make up about 4.9 per cent," said Ferlito when interviewed on NST's Beyond the Headlines.
Last week, the government announced that it will review the minimum wage this year, taking into account the views of both employers and employees.
LINK: https://www.nst.com.my/news/nation/2024/03/1025787/minimum-wage-be-revie...
Human Resources Minister Steven Sim Chee Keong said the review would be based on the National Wages Consultative Council Act 2011.
The Consumers Association of Kedah (Cake) has also asked the government to boost the current minimum wage of RM1,500 by at least 40 per cent to RM2,100 in its upcoming review.
LINK: https://www.nst.com.my/news/nation/2024/03/1027203/consumer-group-calls-...
Cake president Yusrizal Yusoff stressed that increasing the minimum wage is key to easing the burden of cost of living for the people.
Ferlito said increasing the minimum wage could be detrimental to unskilled workers as they could end up being replaced with technology and automation.
He said he was more concerned with limited growth prospects for Malaysian workers, many of whom are employed by micro-businesses.
Micro-businesses, he said, inherently offer fewer opportunities for career advancements and workers are often confined to limited roles.
He said this was why it was important to facilitate social mobility and encourage businesses to consolidate.
This can foster sustainability within the labour market.
"The real conversation we should be having is on how to favour consolidation among businesses so that scaling up allows for the creation of not only automation opportunities but also better growth opportunities," said Ferlito.
"The real issue is if I enter with a low salary, am I stuck at that salary? It actually (boils down to) career progression, real progression," he added.