The Cabinet has agreed to exempt micro, small and medium enterprises (MSMEs) from the implementation of the new minimum wage increase for the time being, following concerns over rising operating costs and economic pressures.
Entrepreneur Development and Cooperatives Minister Datuk Seri Steven Sim Chee Keong said he raised the minimum wage issue during Wednesday’s Cabinet meeting, where ministers agreed that workers’ wages should continue to improve while ensuring local businesses remain competitive.
He said the government would explore other measures to help raise wages in the MSME sector, including wage subsidies under the Progressive Wage Policy, with salary increases linked to improvements in productivity.
“I raised the minimum wage issue at today’s Cabinet meeting. The Cabinet agreed that the wages of Malaysians must continue to be increased.
“However, we also need to protect local businesses, particularly MSMEs, which are facing pressure from operating costs and current economic challenges,” he said in a statement.
Steven said the government’s aim was to ensure workers received more reasonable wages while allowing MSMEs to remain competitive, expand their businesses and create employment opportunities.
The development comes as Malaysia prepares for a possible further increase to the current minimum wage of RM1,700.
Sinar Harian previously reported that the minimum wage is expected to be raised, with Prime Minister Datuk Seri Anwar Ibrahim expected to announce details during the tabling of Budget 2027 in the Dewan Rakyat on October 9.
Anwar had said the review and study on the minimum wage adjustment were in their final stages before the new rate is announced in the Budget 2027 presentation.
