'Minimum wage increment will slow down Sabah economic recovery'

 By Olivia Miwil - February 20, 2022 @ 4:01pm

A drastic minimum wage increase will not only lead to higher unemployment but slow down the economic recovery, says the Sabah Employers Association. - File pic
A drastic minimum wage increase will not only lead to higher unemployment but slow down the economic recovery, says the Sabah Employers Association. - File pic

KOTA KINABALU: A drastic minimum wage increase will not only lead to higher unemployment but slow down the economic recovery, says the Sabah Employers Association.

Its president Yap Cheen Boon described the 25 per cent increment from the current RM1,200 minimum wage is almost like a decision unilaterally made to put Sabah employers on the receiving end of a bitter deal.

He said Sabah's economy is still reeling from the Covid-19 pandemic, with a majority of businesses still grappling with supply chain limitations, rapidly rising costs and weakened domestic demand.

"Businesses will see a cascading rise in wage costs as those on higher salary levels would demand more, so the impact will not just be restricted to entry-level workers only.

"(It will also be), prompting reviews on plans to hire new workers, and facing a new round of price rises within the market," he said in a statement, here, today.

The association, he said, is also frustrated that employers in the North Borneo state are always the last to know about any impending labour or human resource policies.

Yeap said the mooted minimum wage increase has never been communicated to industry or chamber representatives within the state, to date.

"Without the proper mandate by Sabah employers, industry or chambers to engage, and more importantly to reflect on the true social-economic situation, the purported representative would serve merely as lip service or present a false facade of inclusiveness.

"It would be better to let Sabah's employers be rightfully acknowledged and properly engaged, and not through federal-centric association with partial viewpoints of Peninsular Malaysia which has different economic dynamics than Sabah.

"With acknowledgement of the state government that such ploy should not be allowed to go on further, such that businesses in Sabah can be kept abreast of developments, be informed, be given adequate time to structurally adapt for changes ahead," he said.



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