Kota Kinabalu: Liberal Democratic Party Vice President David Ong cautioned the Government against implementing another minimum wage increase soon after the recent adjustment to RM1,700, which took effect nationwide on Aug 1.
He said businesses, particularly small and medium enterprises (SMEs), need more time to adapt to the current wage structure before facing additional financial pressures.
“Less than a year after the last increase, talk of yet another hike is premature and risks placing unnecessary strain on businesses that are still adjusting,” he said in a statement.
He criticised comparisons between government-linked companies (GLCs) and private sector businesses, noting that some large corporations and GLCs have set entry-level salaries at RM3,000.
“GLCs operate under very different conditions, with guaranteed contracts, subsidies or monopolies that protect their income streams.
“Most private businesses, especially SMEs, operate on thin margins and face direct market competition,” he said.
He said SMEs comprise nearly 98 per cent of Malaysian businesses and employ almost half the country’s workforce.
Many are currently struggling with reduced consumer demand, rising operational costs and cash flow constraints due to global economic challenges.
He said premature wage increases could lead to unintended consequences, including job cuts, hiring freezes or business closures, outcomes that would ultimately harm workers rather than protect them.
“We must ask, what new skills or productivity gains have workers acquired in less than a year that would justify another wage increase?” he said, emphasising that salary increases should correspond with improved productivity and skills development.
Instead of rushing into another minimum wage hike, he suggested the Government should allow businesses more time to absorb the recent wage adjustment while focusing on reducing living costs through stricter price controls and anti-profiteering enforcement.
He also called for enhanced support for SMEs through training programmes, digitalisation initiatives and productivity improvement schemes.
“Workers deserve fair pay and a decent standard of living, but wage hikes must be gradual, realistic and supported by policies that strengthen competitiveness,” he said.
