Why increasing our national minimum wage to RM1,500 is still not enough in Malaysia

Recently, Malaysia has raised its minimum wage from RM1,200 to RM1,500 effective 1st May 2022. Several news sources quoted that the increase in the minimum wage is to match the increased cost of living over the years.

Although that is a valid point, there are still flaws around that line of thought. Malaysian goods and services have been increasing in price for many years. Back then, we raised the minimum wage from RM950 to RM1,200. RM1,200 was a small amount that people can’t do much with. Neither will RM1,500 be enough.

Paying RM1,500 basic salary is not for every business

May I be bold enough to say this – if you are a business that struggles or has issues with paying a RM1,500 basic salary, then you should not be considering hiring anyone at all. It may be a huge sum for your company’s overhead expenses. However, is this something that you are willing to burden yourself on?

Allow me to explain this view I have. If you open a shop and need several shopkeepers to look after the shop. It’s quite likely that you will not pay them anything more than RM1,500 basic. On top of this basic, don’t forget that you may have to pay for OT, which is also another sum of money.

Depending on how big your operations are, you may need multiple employees whom you will be paying the minimum wage. It may not be a big amount but eventually, it does add up, becoming quite a substantial overhead expense.

There is another thing that you will also need to consider: people getting paid these kinds of salaries are quite likely not to stay in the job long term. I mean it’s pretty obvious because not only is the salary low, the work hours tend to be long too. They may stay for a couple of years before going elsewhere for better pasture.

There is also the possibility that the people who are willing to take up these sorts of jobs are school leavers. They do not have many skills, hence willing to take up this kind of pay band. Again, it is quite likely they may not last long as they will look for better offers elsewhere.

If you are a business owner, then you will need to understand one fundamental lesson here. That lesson is that if you are looking to hire with this kind of salary, then you cannot expect the employee to stay on the long term. There may be some exceptions but it tends to be far and few in between. Always remember that people are often in search of opportunities to advance.

If you are a jobseeker who accepts RM1,500 as a basic salary

Then you have nothing to complain about. I may not agree with RM1,500 as our basic salary, however, I am all for mutuality and fairness. If you know that RM1,500 is not sufficient for your monthly expenses, then you have no one else to blame but yourself.

There were times when I heard from young parents saying they took on that minimum wage knowing full well they have kids to take care of. And they very well know that RM1,500 (even before statutory deductions) is not going to be enough to cover even food after they have to pay for mortgages.

People like these exist. And yes, it does come across as worrisome as these people have no idea how to manage their expenses and life. From my past observations, they’d mostly leave their kids at the in-laws’ places before going off for work. At some point in time, it’s quite likely the in-laws will still have to help tide over their expenses too.

However, if you are a young parent earning minimum wage, I wish you well. I do hope that you can find a better job that pays a better income so you don’t just pay for your expenses but also feed your kids too. Don’t dwell on that minimum job forever. It’s not meant to be paid long-term. You’ll need to find something that pays a lot better.

With the rising expenses, you will understand for yourself that RM1,500 will never be sufficient. You may have to find a side income to help you tide over too.

Bottom Line

The national minimum wage in Malaysia may not be the best amount to live on from month to month. You may come from a poorer state where things are a lot cheaper. However, don’t you want bigger paycheques so you can save more and invest more? Extra money is always good, to be honest.

Lydia is a content writer under Headliner by Newswav, a programme where content creators get to tell their unique stories through articles and at the same time monetize their content within the Newswav app.
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