The Malaysian Plastics Manufacturers Association has defended the minimum wage policy saying that there is no need for a further increase in the statutory minimum wage at this juncture, stating that Malaysia’s tight labour market is already creating natural upward pressure on wages.
The association noted that with unemployment at around 3%, employers are competing strongly for workers and making significant efforts to attract and retain employees. Market forces are therefore already contributing to wage growth, and this process should be allowed to continue rather than being replaced by a large across-the-board statutory increase.
MPMA considers the proposed RM3,100 minimum wage unrealistic and unnecessary under current conditions stating that a substantial increase would raise not only the wages of minimum-wage workers but also payroll costs across different employee levels as companies seek to maintain appropriate wage differentials.
It added that manufacturers are already facing higher energy, logistics, freight, insurance and raw-material costs, as well as global supply-chain and geopolitical pressures.
Instead MPMA said higher wages must be supported by higher productivity and value creation. “Employers create the conditions for productivity through investment in technology, automation, digitalisation, skills and better processes – while employees convert these improvements into results. The resulting gains should benefit both companies and employees through sustainable, productivity-based wage progression” it was quoted as saying.
The manufacturing group asks government to facilitate investment through stronger automation grants, tax incentives and skills-development support, while employers continue investing in productivity and employees participate in and benefit from the resulting gains.
