MEB : Minimum wages: speaking up for the blue collars

ARCHIVES 2010

By admin-s On Apr 9, 2010

I have seen with my own eyes a factory worker in Seri Damansara get paid RM25 for an 8 hour shift, that make up to RM0.89 per hour.

By Lee Wee Tak

Ok, there should be a consultative process somewhere, right? I believe the various parties with stronger bargaining position and connection will dominate the discussion (in addition to those I categorised as “Malaysia only pressure group” like Perkasa)

However it is for the men / women in the street that the socialist democrat in me that make me wanna speak up for them. Perhaps some soul from Parti Sosialis Malaysia would like to add on to my comments as well.

page 111 highlighted some potential trade offs:

*Reduced dependence on foreign labour encourages firms to move up the value chain or embrace automation while those that cannot will exit, costing some local jobs

* Flexible hiring and firing reduces entry and exit costs for businesses while wage levels will better reflect skills; but the perception of less job security will irk unions

page 114 got me thinking:-

Some have suggested that a formal minimum wage might be helpful to cushion workers against such shocks or downturns. The NEAC strongly believes this would be a wrong approach and in fact could exacerbate the situation by reducing competitiveness and reducing employment opportunities.

Blue collar workers are at the bottom of the food chain. The booklet correctly stated the potential danger for them – lack of job security. Now giving thumbs down to minimum wage scheme is adding salt to injury, especially when subsidies would be withdrawn gradually as well. Sounds like some people would be pushed to the corner, albeit the booklet did mention a bit about social safety net.

Saying minimum wage would erode competitiveness is not absolutely correct. According to Yazhou Zhoukan (Asian Weekly) 11 April 2010 edition, in 2009 the hourly wage (in US Dollars) for the following countries are as follows:-

Australia 11.16
USA 7.25
South Korea 3.22
Taiwan 2.72
Guangzhou 0.79

Dare we say they are not competitive?

I have seen with my own eyes a factory worker in Seri Damansara get paid RM25 for an 8 hour shift, that make up to RM0.89 per hour. Back in the 1950’s Malaysia were much much richer than Taiwan or Korea ravaged by wars then.

Another issue needs considering is that as Malaysia moves (hopefully) towards high income society, rental rates would increase, no thanks to speculators and bidders. According to the magazine quoted above, there are cases in Hong Kong where employers would pass on the negative impact to the workers. Who is there to speak up for them?