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With Malaysian businesses suffering from poorer profits this year in light of the sluggish economy, prospects of pay increases and bonuses look bleak, Sin Chew Daily reported.
In an interview with the local newspaper, Datuk Low Kian Chuan, secretary-general of the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) pointed out that bonuses issued by local businesses to their employees this year were lower than in the past two years.
Low added that given the belief that the inflation rate for this year would not exceed 3%, pay increment rate is expected to be well below that margin.
“Not all companies will distribute bonuses to their staff; only companies that are making profits will do so. Those not making any profit may nevertheless provide some incentives to their workers.”
Other than specific sectors such as export-oriented industries, most economic sectors have seen sub-par performance – including the real estate industry, Low told Sin Chew Daily.
“For profitable companies in certain sectors such as banks, the employees can still look forward to at least eight or twelve months of bonuses. As for the plantation sector, bonuses for employees have been exceptionally good during the past few years due to lucrative profits.
“CEOs and senior executives of some large companies can also look forward to impressive bonuses if they perform up to company expectations,” he added.
Citing a survey report by the Malaysian Employers Federation (MEF), Low pointed out that average rate of pay rises for 2017 is 5.3%, compared to the 5.8% to 6% recorded in previous years. Generally speaking, the pay rise rate is between 3% and 6% this year.
READ MORE: Malaysia’s salary and job trends for 2017
“The situation is a little special this year because under the minimum wage scheme, some companies hiring foreign workers already raised their employees’ salaries on July 1 last year, from RM900 to RM1,000 or higher,” he told Sin Chew Daily.
He also said the pay rise margin for non-executive staff would be higher than that of executives because of their generally lower salaries.
On the topic of layoffs, Low said: “Although more people were laid off last year, the situation has not reached an alarming stage yet.”
According to the MEF, a total of 31,476 employees in Malaysia were laid off between 1 January and September 2016.