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Earlier this week, the Malaysian Employers Federation (MEF) caused quite a stir when it claimed that many businesses will go under if the living wage in urban cities is set at RM2,700 per month.
MEF executive director Datuk Shamsuddin Bardan told Sinar Harian that wage increments must be in line with employees’ productivity and level of professionalism.
While his statement raised the hackles of Malaysians online and worker’s union groups including the Malaysian Trades Union Congress (MTUC), it turns out that the International Trade and Industry Ministry (MITI) just proved that Malaysian workers are indeed underpaid.
In a tweet on 1st July, MITI released data from the 27th National Productivity Report 2020 by Malaysia Productivity Corporation (MPC) that showed the national labour productivity actually grew by 2.2% in 2019.
Tahap produktiviti tenaga kerja di Malaysia yang tinggi menunjukkan rakyat Malaysia adalah sebuah komuniti yang produktif. Dari sudut ekonomi pula, tahap produktiviti yang tinggi akan mampu menjadikan Malaysia lebih kompetitif. @AzminAli @limbanhong @MPC_HQ @lokmanhakim_ali pic.twitter.com/xeNTr4G9nE— MITI Malaysia (@MITIMalaysia) July 1, 2020
Based on the productivity report, the average Malaysian employee creates RM40.60 of value for every hour worked, which adds up to RM6,496 for a month of work (8 hours/day, 5 days/week).
The report even specifically states that Malaysia’s labour productivity has maintained a steady growth over recent years.
Even the Statistics Department (DOSM) noted in their Malaysian Economic Statistics Review Vol. 1/2020 Report that the value added per hour worked is RM40.
Many online were quick to note the vast difference in this value compared to the national minimum wage of RM1,200.
Malaysian Productivity: RM40.60/hour (RM7,037/month)— Stay At Home Soybean Socialist ✊🏼 🏳️🌈 🏳️⚧️ (@Natcromancer) July 2, 2020
Malaysian Median Income: RM13.32/hour (RM2,308/month)
Malaysian Minimum Wage: RM6.35/hour – RM6.92/hour (RM1,100-RM1,200/month)
Seems that the Malaysian worker is being underpaid. I wonder where all that surplus is going 🤔 https://t.co/JosGiXwOAX
26hari X 8jam X Rm40.60 = RM8444.80 sebulan.Tapi gaji minimum rakyat Malaysia hanya Rm1200 sebulan. Jauh beza ye https://t.co/1Kn4f3aqD0— amirulayob (@ayoub_mirul) July 2, 2020
'value added per hour ' . Yeah right. Overworked underpaid https://t.co/Uh46FlpeWj— qidran asyraf (@qidr_an) July 2, 2020
so how do you justify a minimum wage that is well below our levels of productivity. https://t.co/lBeCiBHXrU— Nabil Ersyad (@NabilErsyad) July 1, 2020
A 2016 report by Bank Negara Malaysia revealed that the minimum living wage for a single adult in an urban area is RM2,700, over twice the current minimum wage.
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