RM2,500 starting pay makes little difference for graduates, say economists

Economists argue that setting a minimum starting salary of RM2,500 for graduates would have limited impact on their wages since most companies already pay that amount. Geoffrey Williams of Williams Business Consultancy Sdn Bhd noted that graduates typically earn between RM2,500 and RM3,500 monthly. Yeah Kim Leng from Sunway University considered the proposed rate a "reasonable legal floor" but insufficient to meet a living wage in major cities.

Barjoyai Bardai from the Malaysia University of Science and Technology pointed out that the proposal is important because academic qualifications and skills do not always equate to adequate remuneration. The government's proposal, announced in Budget 2027, aims to ensure that pay scales reflect workers' academic qualifications instead of solely relying on the general national minimum wage, which has increased from RM1,700 to RM2,000.

Williams suggested that a minimum starting salary could lead to some employers deciding not to renew employment contracts, posing a double-edged sword for graduates. Yeah agreed that RM2,500 as a minimum starting salary is a "reasonable legal floor" but falls short of a living wage, especially in major cities. He suggested that the minimum starting salary should be determined through a tripartite negotiation involving the government, employers, and workers instead of being solely dictated by market forces or rigidly fixed by the government.