Friday, February 3

34 pct workers earning below poverty line: Study

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KUALA LUMPUR: A study on wages in the country, initiated by the human resources ministry, has revealed that almost 34 per cent of about 1.3 million workers earned less than RM700 a month — below the poverty line of RM720 per month.

The minister, Datuk Dr S Subramaniam, said the National Employment Return study last year stressed on the need for wages to be increased, especially after the ministry discovered that it was difficult to rely on market forces alone.

He also cited the World Bank study which found that the wage trend in Malaysia had recorded only an annual 2.6 per cent growth during the past 10 years, as compared to the increasing cost of living during the same period.

“The government agrees that wages will have to be increased,” he told reporters here yesterday.

He said the influx of foreign workers was among several reasons why wages did not increase for the past 10 years.

“Skilled jobs are synonymous with higher wages. However, in many instances, employers do not pay for skills, instead, relying on unskilled foreign workers. This has also largely dampened wage growth,” he noted.

Wednesday, after closing a workshop on minimum wage, Dr Subramaniam said he would table his ministry’s proposal on a national minimum wage to the Cabinet by October.

At the workshop, there were differing views on the proposal where some felt the implementation of minimum wage would lead to erosion of competitiveness, wage spirals and unable to narrow the gap between the rich and poor in the country, while others felt it would increase productivity and quality of workers.

The minister said, should the government agreed to a minimum wage, new laws needed to be introduced to cover all aspects such as coverage, authority, advisory body, implementation and so on.

There would also be a need to form a national council on minimum wages to ensure the smooth implementation of the minimum wage, he added. — Bernama