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Sarawak business group concerned over new minimum wage

KUALA LUMPUR: A Sarawak business group has voiced concern that the new RM1,700 minimum wage could to higher operational costs for small and medium enterprises (SMEs).

Sarawak Entrepreneur Association president, Nizam Khalyd said wage increases should be phased and that SMEs would need support to avoid them having to raise prices of products and services.

He said a gradual approach to raising wages would allow businesses to adjust cost structures, improve productivity and and introduce technological innovations.

"This would ensure a smoother transition to higher wages without destabilising the economy," Nizam said according to the Borneo Post.

Yesterday, employers in Perlis, Kelantan, and Sabah said they were not ready to implement the RM1,700 minimum wage announced during the tabling of the 2025 Budget last week.

They said their slow economic growth would not allow them to absorb the RM200 increase in the minimum wage which takes effect from Feb 1.

For businesses with fewer than five employees, the new minimum wage will take effect on Aug 1.

Nizam called for dialogue with the business community to ensure SMEs are consulted and given the necessary support.

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