{
  "id": 12768979,
  "title": "Minimum wage to have mixed impact on consumer sector: Kenanga Research",
  "url": "https://urgent.news/2026/10/08/minimum-wage-to-have-mixed-impact-on-consumer-sector-kenanga-research",
  "topic": "business",
  "section": "Business",
  "published": "2026-10-08T02:50:22.000Z",
  "source": {
    "name": "New Straits Times",
    "slug": "new-straits-times",
    "url": "https://www.nst.com.my/business/corporate/2026/10/1550272/minimum-wage-have-mixed-impact-consumer-sector-kenanga-research"
  },
  "original_language": "en",
  "account": "KUALA LUMPUR: Kenanga Research has highlighted that a potential increase in the minimum wage could have mixed effects on the consumer sector. The research firm estimates that an RM100 increase in minimum wages could result in a 0.1% to 2.7% reduction in earnings for consumer-facing businesses. However, Kenanga Research believes household incomes might help offset the impact of increased wages.\n\nThe firm noted that the impact of the minimum wage hike would differ across various sectors within the consumer industry. Labour-intensive companies are expected to face more significant cost pressures due to the wage increase, while these businesses may also benefit from potentially higher consumer spending.\n\nKenanga Research emphasized that consumer spending has a buffer, but it faces headwinds. The firm suggests that targeted fiscal assistance, such as Sumbangan Asas Rahmah and Sumbanfan Tunai Rahmah, along with potentially higher wages, could help support household purchasing power. Nonetheless, companies are entering a less favorable cost environment as labor, electricity, freight, and selected input costs rise. Price-sensitive consumers may also limit companies' ability to pass on higher costs to customers, putting additional pressure on margins.\n\nAnother potential headwind for the sector is the possibility of a 25-basis-point hike in the overnight policy rate (OPR) in the first quarter of 2027, according to Kenanga Research. Historically, consumer sentiment and share prices have weakened following two of the three previous OPR hiking cycles.\n\nKenanga Research currently rates the sector as Overweight, acknowledging that many concerns have become more apparent in valuations following recent share price weakness. The firm believes that companies that can capture resilient consumption without significant cost pressures should be better positioned for success. Kenanga Research recommends QL Resources Bhd as its top pick within the sector, with an \"outperform\" rating and a target price of RM4.40.",
  "summary": "KUALA LUMPUR: A potential minimum-wage increase could cut earnings by 0.1 per cent to 2.7 per cent for every RM100 increase across Kenanga Research’s consumer coverage.",
  "key_points": [
    "Potential RM100 minimum wage increase could reduce consumer business earnings by 0.1% to 2.7%",
    "Labour-intensive consumer businesses may face higher cost pressures from wage hike",
    "Household incomes and targeted fiscal assistance could offset impact of increased wages"
  ],
  "editors_take": "A potential minimum wage increase will likely benefit labour-intensive consumer businesses through higher consumer spending, but put pressure on their margins due to rising labour costs.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}