KUCHING: A minimum wage hike will cause a domino effect on the cost of doing business which will in turn be passed on to the people, said Sarawak Timber Association (STA) in a statement on Wednesday (Feb 9).
“While they may actually be receiving more ringgit in their pockets with the increased minimum wage their real purchasing power will not be growing in tandem.
“In such case, the increase in minimum wage will not help mitigate the people’s rising cost of living.”
The STA argued that the use of minimum wage to address the rising cost of living was therefore not an appropriate measure.
“This endless vicious cycle will certainly prolong the economic recovery and be vastly detrimental to the country’s economic situation as a whole.
“The well-being of the people will also be affected by the slow recovery of the country’s economy.”
The federal government recently proposed to raise the minimum wage from RM1,200 to RM1,500 by end of this year.
STA stressed that the government has a crucial role to play in stabilising businesses to ensure a steady economic recovery in the country.
Consistent policies that will assist to strengthen businesses are vital during this period, so that the country is able to regain its status as an attractive investment destination, it added.
STA urged the government to not increase the minimum wage until the economic situation stabilised.
