Low Wages Don T Blame Smes Fix The System


 If we are serious about breaking the so-called ‘addiction’ to low wages, we must first fix the foundations.
From William Ng
Over the past few days, the oft-quoted claim that Malaysia is “addicted to low wages” again resurfaced in public discourse and across the policymaking circles.
While such commentaries bring attention to the very real concern of wage stagnation, it also risks misdiagnosing the root problem and unfairly placing blame on businesses, particularly small and medium enterprises (SMEs), who are in fact just as much products of, as they are victims of the system.
Let’s be clear: SMEs are not addicted to low wages. They are trapped in a low-productivity ecosystem that they did not create and are struggling to navigate.
Rather than condemning businesses for not paying more, we must examine the structural barriers that make wage growth difficult and ask what role the government and society must play in enabling long-term, sustainable improvement.
Why we can’t compare Malaysia to Korea, Japan (yet)
Calls to emulate the wage share of advanced economies like Japan and South Korea ignore fundamental differences in our stage of development. These countries have spent decades building high-value industries, deepening local supply chains, and investing heavily in education and research. They didn’t raise wages by legislation (like we do), but they raised productivity first.
In contrast, Malaysian SMEs largely operate in low-margin industries, face fragmented supply chains, and contend with inconsistent policy support. Expecting them to pay South Korean or Japanese wages, or wage ratio, without the same foundation is unrealistic.

Take our educational achievements, for example. According to the Programme for International Student Assessment (PISA), only 1% of our 15-year-olds achieved Level 5 or 6 in mathematics; compared to 41% in Singapore and 23% in Japan and Korea. The issue is structural, not merely behavioural.
SMEs want to pay more, but the system must change
The notion that employers “choose” to keep wages low is both inaccurate and unfair. Many SMEs want to pay more, but their ability to do so is constrained by razor-thin profit margins, driven by rising input costs, regulatory burdens, and a race-to-the-bottom pricing environment.
To make matters worse, there is a long-standing mismatch between skills and market needs, which forces firms to spend on retraining or accept underqualified hires.
Access to automation and advanced technologies remains limited. Despite government incentives, SMEs struggle with the upfront costs, lack of scale, and underutilisation risks.
Technology adoption is not just about subsidies; it’s about fit-for-scale solutions, which are rarely designed with SMEs in mind.
If we want wages to rise, we must increase productivity. And that requires coordinated investment, meaningful support, and a change in our national economic narrative.
We must shift the conversation from “why aren’t businesses paying more?” to “what is stopping businesses from paying more?” The answers point squarely to systemic shortcomings.
The elephant in the room is our education system that produces 14,000 straight A students annually, yet struggles to hit that 1% Pisa. We urgently need a skills pipeline aligned with industry needs. Technical and vocational education training (TVET) must be elevated, not treated as a second-class option.
Most SMEs operate in the low-productivity services sector, yet our national policies continue to focus disproportionately on manufacturing and exports. We need targeted interventions to help service-based SMEs move up the value chain and shift away from low-growth sub-sectors.
Another frequent scapegoat in the low-wage debate is the foreign workforce. The popular argument is that their lower cost suppresses local wages. But this oversimplifies the issue. The total cost of hiring foreign workers, including levies, agency fees, accommodation, and insurance, is often higher than hiring a similarly skilled local worker. The real issue is structural, not labour substitution.
Reducing dependence on low-skilled foreign labour is important, but it must be done gradually, with viable alternatives in place for businesses to remain competitive.
Reform, not blame
Some argue that until we resolve the productivity-wage disconnect, we must at least legislate a living wage. I agree. But wage increments alone will not address inequality if the cost of living – encompassing housing, transport, and healthcare – continues to outpace income. A broader set of social and economic reforms is essential.
Vilifying SMEs is not the answer. We should see them as partners in national development and support them in becoming better employers. Wage growth must be tied to productivity—not forced in a way that undermines business viability, jobs and long-term investment.
We are not against higher wages. On the contrary, we want a Malaysia where businesses are thriving, workers are valued, and wages rise alongside economic progress. But this cannot be achieved by rhetoric or mandates alone. It requires systemic reform, a whole-of-nation approach, and a long-term national commitment to economic transformation.
If we are serious about breaking the so-called “addiction” to low wages, we must first fix the foundations. Blaming SMEs is a distraction. Let us instead focus on building the institutions, capabilities, and incentives that will allow all Malaysians—workers and businesses alike—to prosper. - FMT
William Ng is the national president of the Small and Medium Enterprises Association of Malaysia (Samenta), Malaysia’s oldest association for SMEs.
The views expressed are those of the writer and do not necessarily reflect that of MMKtT.


Artikel ini hanyalah simpanan cache dari url asal penulis yang berkebarangkalian sudah terlalu lama atau sudah dibuang :

http://malaysiansmustknowthetruth.blogspot.com/2025/05/low-wages-dont-blame-smes-fix-system.html

Kempen Promosi dan Iklan
Kami memerlukan jasa baik anda untuk menyokong kempen pengiklanan dalam website kami. Serba sedikit anda telah membantu kami untuk mengekalkan servis percuma aggregating ini kepada semua.

Anda juga boleh memberikan sumbangan anda kepada kami dengan menghubungi kami di sini
Malaysia Addicted To Low Wages Says Shahril

Malaysia Addicted To Low Wages Says Shahril

papar berkaitan - pada 9/5/2025 - jumlah : 142 hits
The former Umno man says the nation s economic structure prioritises a low median wage Shahril Hamdan said during his time in the PMO he received pushback when proposing to reduce the ratio between CEO salaries and the median wage of compan...
Is Upholding The Law A Low Point Now

Is Upholding The Law A Low Point Now

papar berkaitan - pada 12/5/2025 - jumlah : 212 hits
Sadly many people are quick to criticise laws perceived as Islamic forgetting the long term benefits and protections they can provide practices is a crime I was shocked to read this especially coming from someone trained in law A basic sear...
Singapore S Operation Lalang Against The Catholic Church 1987 Majulah Singapura

Singapore S Operation Lalang Against The Catholic Church 1987 Majulah Singapura

papar berkaitan - pada 3/5/2025 - jumlah : 209 hits
First here is a message by Singapore s fourth Prime Minister Lawrence Wong Lawrence Wong is the first PM of Singapore who is a Christian No big deal Just that Singapore s first three prime ministers did not believe in the existence of a god...
Singapore Ge Voters Head To The Polls Around The World

Singapore Ge Voters Head To The Polls Around The World

papar berkaitan - pada 3/5/2025 - jumlah : 154 hits
Polling stations across Singapore opened at 8am today as more than 2 75 million eligible voters began casting their votes in the country s general election A total of 1 240 polling stations are operating nationwide and will close at 8pm Vot...
Woi This Is Malaysia La Who Cares Isn T Maruah The Cousin Of Barua

Woi This Is Malaysia La Who Cares Isn T Maruah The Cousin Of Barua

papar berkaitan - pada 3/5/2025 - jumlah : 157 hits
I say man who cares who slept with whom Or who grabbed whose This is Malaysia la Semua boleh That Bossku fellow had RM2 6 billion in his bank account And there are people who say he was innocent Now they confiscated RM170 million in cash fr...
Trump And The Triumph Of The Technolords

Trump And The Triumph Of The Technolords

papar berkaitan - pada 3/5/2025 - jumlah : 136 hits
The repercussions of the societal transformation accelerated by techlordism include unprecedented macroeconomic instability the demise of democracy and the end of universities a totally centralised mechanism for matching buyers and sellers ...
Papa Zola The Movie

Papa Zola The Movie

papar berkaitan - pada 3/5/2025 - jumlah : 197 hits
Monsta penerbit tersohor di sebalik kejayaan filem animasi pecah panggung BoBoiBoy dan Mechamato dengan kerjasama Astro Shaw kini secara rasmi melancarkan teaser bagi francais filem animasi keempat mereka yang dinanti nantikan Papa Zola The...
Dr M S New Malay Platform Key To Uniting Divided Community Says Tuan Ibrahim

Honor 400 Series Now Free With Telco Plans Here S How To Score It

Former Macc Chief Questions Legality Of Second Seizure Of Ilham Tower

A Complete Guide To Sd Muhammadiyah 1 Tanggul For

Top Ways To Monetize Your Domains

Kelebihan Dan Faedah Kereta Elektrik Berbanding Kereta Konvensional

Guardian Hairppiness Segala Galanya Tentang Rambut

Selebriti Terkenal Didakwa Terlibat Kes Amang Seksual Rakan Baik Sissy Imann


echo '';
Info Dan Sinopsis Drama Berepisod Dendam Seorang Madu Slot Tiara Astro Prima

10 Fakta Biodata Amira Othman Yang Digosip Dengan Fattah Amin Penyanyi Lagu Bila Nak Kahwin

5 Tips Macam Mana Nak Ajak Orang Kita Suka Dating Dengan Kita

Info Dan Sinopsis Drama Berepisod Keluarga Itu Slot Lestary TV3

Bolehkah Manusia Transgender Mencapai Klimaks Selepas Bertukar


12 Pernikahan Artis Malaysia Bertemakan Outdoor

Enau Bersamaku Akan Sedikit Susah Chord

Ipank Kau Duakan Aku Chord

Lima Mangsa Kemalangan Maut Jerantut Feri Telah Dikenalpasti Buat Pusingan U Secara Mengejut Jadi Punca

Kalahkan China Indonesia Bertengger Di Urutan Ke 4 Kualifikasi Piala Dunia 2026 Zona Asia

Reagan Airport Is Pausing Flights For Trump S Military Parade What Will It Mean For Travelers