SANDAKAN: Parti Warisan Sabah Tanjong Papat Assemblyman Alex Thien Ching Qiang said increasing people’s incomes and gradually improving the minimum wage should be among the country’s priorities, but minimum wage policies should not focus solely on the wage figure.
He said the government must take into account various factors, including the level of economic development in different states, the operating environment for businesses, industry characteristics, productivity and the actual capacity of businesses to absorb higher labour costs, particularly given the structural economic differences between Sabah and Peninsular Malaysia.
He said the economic scale, purchasing power, business ecosystem and market conditions in major cities in Peninsular Malaysia were not entirely comparable to those in Sabah.
Many micro, small and medium-sized enterprises (MSMEs) in Sabah were already facing multiple pressures, including rising operating and labour costs as well as limited market size.
Therefore, before implementing a nationwide increase in the minimum wage, the government must carefully assess its potential impact on Sabah’s economy.
“I agree that workers’ wages should gradually increase alongside economic development so that the people can share in the benefits of economic growth.
“However, any increase in the minimum wage must be gradual, data-driven and implemented in tandem with productivity growth, rather than simply increasing the figure and passing all the additional costs on to businesses,” he said.
Thien pointed out that one of Sabah’s major employment sectors is the oil palm and plantation industry, where income is closely linked to international palm oil prices, which plantation operators have no control over.
He said that if wages and other statutory employment costs continued to rise while operators were unable to correspondingly increase the selling price of their products, their profit margins would come under further pressure.
Smaller plantations, particularly those with older trees, lower yields or facing high replanting costs, could even face losses and difficulties in maintaining operations, he added.
“If businesses are unable to remain financially viable, even the highest minimum wage cannot create sustainable employment opportunities. Therefore, protecting workers while ensuring that businesses can continue operating are actually two sides of the same issue,” he said.
Thien said that if the Federal Government were to further raise the minimum wage in the future, it should take into account the different economic structures of Sabah and Peninsular Malaysia and provide Sabah with greater policy flexibility in terms of business transformation support and implementation timelines, while ensuring that Sabah workers’ incomes would not be overlooked because of regional differences.
He also proposed that Bank Negara Malaysia, the Department of Statistics Malaysia, the Ministry of Human Resources and credible independent research institutions conduct a more comprehensive economic impact study on minimum wage adjustments.
Such studies, he said, should cover Sabah, Sarawak and Peninsular Malaysia, while also examining differences across regions, industries, business sizes and categories of workers.
He said the research should not only calculate the increase in workers’ income following a minimum wage adjustment but should also examine factors such as business costs, employment levels, prices, productivity, automation, business closure risks, new job opportunities and the competitiveness of different industries.
“The government should make the full findings of such studies public so that society can see both the benefits and potential costs of increasing the minimum wage. Good public policy cannot focus only on the benefits; it must also honestly address the potential side effects,” he said.
Thien said increasing wages could not ultimately rely solely on administrative directives but must take place alongside business upgrading and economic structural transformation.
“What we want to see is higher wages, higher productivity and more competitive businesses, rather than a situation where higher wages lead businesses to reduce their workforce, stop hiring, raise prices or even cease operations,” he said.
He said that if the government wanted to promote higher wages, it should also assist MSMEs with automation, digitalisation, technological upgrading, employee training and productivity improvements, while providing appropriate tax incentives, financing and business transformation assistance.
“Minimum wage growth cannot be achieved through businesses bearing the cost of transformation alone. The government must work together with businesses to drive this transformation. Only when productivity, economic scale and workers’ wages improve together can we truly build a sustainable high-wage economy,” he said.
Thien stressed that he supported efforts to increase the income of Sabahans, but any new minimum wage policy must be based on Sabah’s actual economic conditions.
“Our goal should not simply be to make the figure on a payslip bigger but to ensure that people have greater purchasing power, businesses can continue to survive and grow, and Sabah can create more and better employment opportunities. That should ultimately be the objective of a minimum wage policy,” he said.
Govt urged to prioritise increasing people income and improving minimum – Warisan rep
SANDAKAN: Parti Warisan Sabah Tanjong Papat Assemblyman Alex Thien Ching Qiang said increasing people’s incomes and gradually improving the minimum wage should be among the country’s priorities, but minimum wage policies should not focus solely on the wage figure.
He said the government must take into account various factors, including the level of economic development in different states, the operating environment for businesses, industry characteristics, productivity and the actual capacity of businesses to absorb higher labour costs, particularly given the structural economic differences between Sabah and Peninsular Malaysia.
He said the economic scale, purchasing power, business ecosystem and market conditions in major cities in Peninsular Malaysia were not entirely comparable to those in Sabah.
Many micro, small and medium-sized enterprises (MSMEs) in Sabah were already facing multiple pressures, including rising operating and labour costs as well as limited market size. Therefore, before implementing a nationwide increase in the minimum wage, the government must carefully assess its potential impact on Sabah’s economy.
“I agree that workers’ wages should gradually increase alongside economic development, so that the people can share in the benefits of economic growth. However, any increase in the minimum wage must be gradual, data-driven and implemented in tandem with productivity growth, rather than simply increasing the figure and passing all the additional costs on to businesses,” he said.
Thien pointed out that one of Sabah’s major employment sectors is the oil palm and plantation industry, where income is closely linked to international palm oil prices, which plantation operators have no control over.
He said that if wages and other statutory employment costs continued to rise while operators were unable to correspondingly increase the selling price of their products, their profit margins would come under further pressure.
Smaller plantations, particularly those with older trees, lower yields or facing high replanting costs, could even face losses and difficulties in maintaining operations, he added.
“If businesses are unable to remain financially viable, even the highest minimum wage cannot create sustainable employment opportunities. Therefore, protecting workers while ensuring that businesses can continue operating are actually two sides of the same issue,” he said.
Thien said that if the Federal Government were to further raise the minimum wage in the future, it should take into account the different economic structures of Sabah and Peninsular Malaysia, and provide Sabah with greater policy flexibility in terms of business transformation support and implementation timelines, while ensuring that Sabah workers’ incomes would not be overlooked because of regional differences.
He also proposed that Bank Negara Malaysia, the Department of Statistics Malaysia, the Ministry of Human Resources and credible independent research institutions conduct a more comprehensive economic impact study on minimum wage adjustments.
Such studies, he said, should cover Sabah, Sarawak and Peninsular Malaysia, while also examining differences across regions, industries, business sizes and categories of workers.
He said the research should not only calculate the increase in workers’ income following a minimum wage adjustment, but should also examine factors such as business costs, employment levels, prices, productivity, automation, business closure risks, new job opportunities and the competitiveness of different industries.
“The government should make the full findings of such studies public, so that society can see both the benefits and potential costs of increasing the minimum wage. Good public policy cannot focus only on the benefits; it must also honestly address the potential side effects,” he said.
Thien said increasing wages could not ultimately rely solely on administrative directives, but must take place alongside business upgrading and economic structural transformation.
“What we want to see is higher wages, higher productivity and more competitive businesses, rather than a situation where higher wages lead businesses to reduce their workforce, stop hiring, raise prices or even cease operations,” he said.
He said that if the government wanted to promote higher wages, it should also assist MSMEs with automation, digitalisation, technological upgrading, employee training and productivity improvements, while providing appropriate tax incentives, financing and business transformation assistance.
“Minimum wage growth cannot be achieved through businesses bearing the cost of transformation alone. The government must work together with businesses to drive this transformation. Only when productivity, economic scale and workers’ wages improve together can we truly build a sustainable high-wage economy,” he said.
Thien stressed that he supported efforts to increase the income of Sabahans, but any new minimum wage policy must be based on Sabah’s actual economic conditions.
“Our goal should not simply be to make the figure on a payslip bigger, but to ensure that people have greater purchasing power, businesses can continue to survive and grow, and Sabah can create more and better employment opportunities. That should ultimately be the objective of a minimum wage policy,” he said.
