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Monday, May 02, 2022

“Liew, increasing Johoreans’ wages alone may not resolve the problem”



“Liew, increasing Johoreans’ wages alone may not resolve the problem”

By Prof Ramasamy Palanisamy




I MIGHT superficially agree with the Johor DAP chairman Liew Chin Tong that higher wages in Johor might attract talents to the state.

Specifically, paying two-thirds of what Singapore pays might allow workers to consider working in Johor itself instead of in the island-state.


Of course, Liew qualifies his argument by saying that the rise in wages is something long term predicated on the notion of high-end investments to Johor.


As the newly minted Opposition leader, his idea of upgrading the salary of workers in Johor is something that newly elected state government should definitely think about.


Having said this, I am not sure that a mere upgrading of wages to two-thirds of level to Singapore is a straight forward matter. High-end investments and talents are important in the upward wage movement amongst workers.


Unfortunately, the payment of wages to the level near to that of Singapore is easier said than done. Wages are low in Malaysia and Johor by extension not because of the operation of a variety of factors.

In general, low wages are equated with the low productivity of workers, an infamous argument often invoked by employers to deny wage increases.

But a more important argument in favour of high wages is whether or not workers are talented, have the required skills and others. Even if we accept the argument of wage differentials on the basis of talents and productivity, the present wage system in Johor or the country as a whole cannot be defended.

I am not sure when taking about wages, whether Liew was referring to the workforce in Johor as a whole or to the manufacturing and service sectors alone.

Even if an argument can be pursued to raise wage levels in the manufacturing and service sectors near to Singapore, then what about the agricultural sector; particularly the plantation sector where the production of palm oil which is a booming commodity.

Wages in the plantation sector is extremely low compared to the other two sectors.

But many plantation players think it is preposterous raise wages among plantation workers near to that of wages in Singapore. The curse of forced labour practices will forbid it.

How can we not address the issue of forced labour that is crippling the wage increases in Malaysia as a whole? By the way, forced labour is not just confined to the plantations but quite is pervasive in manufacturing sector that rely on cheap and malleable labour.

Forced labour, weak unions

So back to Liew, I am not sure why he ignored the problem called “forced labour” when talking about wage increase in his enthusiasm about wage increase.

Th reality is, Malaysia attracts foreign multinational companies because of the subdued nature of our labour force.

The minimal strength of trade unions and the pro-employer policies of the Government act as powerful incentives for investments in manufacturing and services.

So how are we to increase wages when there exist forces that are inimical to the long-term interests of labour?

In any case, it is not that Singapore is heaven for the working class. In fact, despite high wages in comparison to Malaysia, the repression of workers there is much more severe than here.

The corporatist model of trade unionism in Singapore militates against labour gains. Malaysia has poor variant of this model in the form of tripartite arrangement that allows for some labour manoeuvrability.

Of course, wages are high in Singapore not in absolute but in relative terms. It is just that the difference between Johor and Singapore is more reflective of the nature of development more than anything else.

In this sense, comparing the labour situation in Johor with Singapore might not really address the matter of low wages in Johore.

In fact, I would have expected Liew to take more objective look at the labour situation in the state by factoring not just the manufacturing and services sectors but also the plantation sector.

If the comparison was made to prevent workers from Johor moving to Singapore, then even the levelling of wages might not make any sense.

Thousands of workers travel daily to work in Singapore. With the savings from the hard-earned money, they have bought houses and invested in properties because of the low cost of living and depressed property market.

Yes, they work in Singapore with higher salary than if they had worked in Johor. In a sense, they enjoy the benefits of the two worlds!

And I am sure if they had been paid two-thirds the salary in Johor, they would still prefer to work in Singapore.

Liew missed the point that it is not salary alone but there are other variables that need to be taken into account as to why workers have preference for Singapore if they can help it.

Daily journey to Singapore is a nightmare but it still worth it considering compared to the pittance they get in Johor, in addition to the demeaning aspects of racial and religious politics. – May 2, 2022



Prof Ramasamy Palanisamy is the state assemblyperson for Perai. He is also deputy chief minister II of Penang.


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