LETTER | A recent article titled “Short-term relief measures not the answer, govt told” crucially pointed out how the cost of living should not be framed mainly as a price issue.

Rather, it is about people’s wages and purchasing power, and government assistance programmes do not address stagnant wages.

A similar, relevant point was on how targeted interventions such as cash assistance, Rahmah sales, selective subsidies, and price controls on essential items were not enough if they failed to translate into stronger purchasing power.

One huge, longstanding contradiction in Malaysia is that despite experiencing high gross domestic product levels annually and being a rich nation, many Malaysians have insufficient wages and savings, especially considering the ever-increasing cost of living.

Another recent article titled “Retirement benchmark feels like distant goal for most M’sians” highlighted how Malaysians in general have difficulty meeting the Employees Provident Fund’s revised target of RM1.3 million in individual savings in order to enjoy a comfortable retirement.

A main challenge cited by people was expenditure towards their children’s education, housing loans, medical bills, and daily expenses. Some said they had to make tough choices like cutting back on non-essential spending.

In terms of having inadequate savings, apart from poor financial behaviour and planning, and inconsistent savings and employment, one major contributing factor is insufficient wages.

This, in turn, is caused by the unfair distribution of wealth and profits by the corporate sector to its own workers.

Dependence on migrant workers

Wages in Malaysia are also kept down by our decades-long and unwise over-dependence on cheap migrant labour. Of great concern is the high number of illegal migrant workers brought in by various parties with their own agendas.

Many employers hire these workers over citizens simply because they are a cheap labour source, which translates into higher profits for these employers.

The government must tackle these serious systemic problems as soon as possible by imposing proper regulations and oversight, mainly towards the bigger and more profitable corporations.

This is to ensure that workers are better compensated, employers do not cheat their workers, and locals are prioritised for hiring over migrant workers.

There must also be stricter government oversight and enforcement towards the relevant government departments, third-party agents, and employers involved in bringing in illegal migrant workers for their own financial gain.

Better wages boost economy

When the working class, which makes up the country’s majority, has higher, fairer wages and thus greater purchasing power, they will naturally spend more domestically.

This will bolster the country’s economy and increase the revenue of not only our local businesses, but of the foreign corporations as well. Hence, increasing wages truly creates a win-win scenario for everyone.

Better wages will also surely help retain more of our local workforce. As a recent opinion piece titled “Malaysia is exporting talent because it refuses to fix the system” emphasised, one core workplace issue in Malaysia is unfair pay, whereby in too many fields, salaries don’t match people’s skills, hard work, or the cost of living.

And this is a main cause of Malaysians increasingly giving up their citizenship to work overseas.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.