Minimum Wage Will Still Give You A Headache If You Live In KL
Experts say minimum wage is not enough to cover these expenses, even with the increase that is coming in effect next year.
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The Department of Statistics Malaysia (DOSM) recently published a report on the average monthly basic living expenses of households in the country last year.
The report showed Kuala Lumpur as having the highest recorded mean per capita of RM1,755, followed by Selangor (RM1,630), and Penang (RM1,471).
Conversely, the lowest recorded expenditures per person were found in Kelantan (RM1,018), Perlis (1,026), and Kedah (RM1,034).
DOSM also reported that Selangor recorded the highest average expenditure per person for food at RM507 a month, followed by Johor (RM476), and Melaka (RM471).
Malaysian residents can use the myPAKW app or visit https://mypakw.dosm.gov.my/ to calculate the total basic expenditure for a decent standard of living based on factors like location, demographics, age, gender, and household size.
Is the minimum wage enough to cover basic living expenses in 2025?
During the tabling of the Budget 2025 on 18 October, Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim announced that the government has agreed to raise the minimum wage from RM1,500 to RM1,700 per month effective 1 February 2025.
In a report dated 14 August, The Star quoted leading economist Dr. Geoffrey Williams as saying the new minimum wage should be around RM1,600, but this is too low because with the compulsory deductions for Employees Provident Fund (EPF), Social Security Organisation (Socso), and Employment Insurance System (EIS), the take-home pay is below the poverty line.
On top of that, Williams added that Bank Negara estimated a living wage of RM2,700 in 2018 that would now be RM3,000 after taking inflation into account.
Parti Sosialis Malaysia (PSM) deputy chairman S. Arutchelvan also agreed that the current minimum wage is outdated and irrelevant and was quoted in the same report saying “The Madani government said the minimum wage for civil servants would be around RM2,000 and the Prime Minister also asked the private sector to follow suit. So, RM2,000 should be the yardstick on minimum wage”.
We might not see a minimum wage above RM2,000 in the next few years, but recent events have shown that the government is slowly moving in that direction although as inflation continues to happen, that might not even be enough in the future.
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