Raising Minimum Wage to RM1,700 to Enhance Quality of Life #3
Starting February 1, 2025, the minimum wage is set to rise from RM1,500 to RM1,700, a change expected to improve people’s quality of life in various ways.
KUALA LUMPUR: Starting February 1, 2025, the minimum wage is set to rise from RM1,500 to RM1,700, a change expected to improve people’s quality of life in various ways.
Economic analyst Assoc Prof Dr Ahmed Razman Abdul Latiff stated that this increase, announced by Prime Minister Datuk Seri Anwar Ibrahim during the Budget 2025 presentation, would enhance workers’ purchasing power, thereby contributing to a more dynamic economy.
“An increase in the minimum wage will allow individuals to buy more nutritious food, secure better housing, and save or invest their earnings,” he explained in a conversation with Bernama.
He noted that this rise would also benefit retailers, as Malaysians would have more money to spend.
During the Budget 2025 announcement on Friday (Oct 18), Anwar, who also serves as the Finance Minister, revealed that the enforcement of the RM1,700 minimum wage would be postponed for employers with fewer than five employees until August 1, 2025.
Financial and entrepreneurship expert Prof Datuk Dr Nik Maheran Nik Muhammad indicated that the hike in minimum wage could reduce the income disparity between low and high-income groups, thereby promoting better social well-being.
“Implementing a higher minimum wage is a positive step as it can enhance livelihoods and purchasing power, stimulating economic growth in the country.”
“Workers will be able to afford essential needs like food, housing, and education, leading to increased demand for goods and services,” he added.
Furthermore, he mentioned that such an increase could motivate workers to be more productive as they would feel valued and inspired to exert more effort.
However, Dr Nik Maheran, affiliated with Universiti Malaysia Kelantan, cautioned that small and medium industries (SMIs) might struggle with the increased wage costs.
“The government should make sure that there are adjustments in other areas, like taxes and incentives, to mitigate any adverse effects stemming from the minimum wage increase.”
“In a volatile economic landscape, raising the minimum wage could present risks if it is not paired with sustained economic growth,” he concluded. – Bernama
