This glaring omission was highlighted by Monash University Malaysia economics professor Niaz Asadullah and Geoffrey Williams, an economist at the Malaysia University of Science and Technology.
Niaz said he had expected to see some details on the progressive wage system in the speech.
Williams noted that along with the progressive wage, details of the long-term subsidy rationalisation was also missing in Anwar’s budget speech yesterday.
Economy minister Rafizi Ramli recently announced that detailed plans for the implementation of the progressive wage system would be unveiled during the budget speech.
While the PWM was approved at the Cabinet level earlier this year, details of its implementation and the impact it will have on various sectors have remained largely shrouded in mystery.
The PWM is a wage structure to increase wages of workers through upgrading skills and improving productivity.
Equity for all
Meanwhile, PwC Malaysia director of workforce management Iesa Morshidi said the initiative should not only enhance income but also ensure equitable treatment for all citizens.
“In addition to raising household incomes, a significant focus is placed on fostering upskilling among Malaysian workers.
“This would ultimately benefit every individual in the country as the ultimate objective is to generate greater value within the market in the long run,” he said.
He added that enabling individuals from the B40 segment to pursue university education plays a significant role in providing them with affordable educational opportunities.
“This would ultimately assist them in elevating their earning potential towards the median income level,” Iesa said.
In order for employers to consider raising wages, there must be an increase in the supply of productive workers.
Initiatives like the unity government’s New Industrial Master Plan (NIMP) will boost the number of productive and skilled workers.
It targets total investment up to RM95 billion in addition to 3.3 million job opportunities with an intermediate salary of up to RM4,510 a month by 2030. The NIMP was officially unveiled by Anwar on Sept 1, 2023.
Questionable quality of graduates
However, such grand initiatives have been hindered by structural issues previously. In particular, Niaz highlighted the unsatisfactory quality of graduates from both the Sijil Pelajaran Malaysia (SPM) stream and public universities.
He said the limitation in the quality of graduates poses an obstacle in meeting the demands of today’s job market.
“To achieve automation in production while seeking highly skilled labour, it is essential to limit the availability of low-wage alternatives, such as migrant workers, for employers,” Niaz said.
“However, past attempts to bring down the proportion of foreign workers in the total workforce to a single digit has failed,” he said.
He added Malaysia is grappling with a welfare crisis as the aftermath of the pandemic has led to an increased disparity between income and the cost of living.
This resulted in the majority of Malaysian households earning below a sustainable living wage.
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