KUALA LUMPUR – Malaysian incomes are not keeping pace with the rising cost of living, former Bank Negara Malaysia (BNM) governor Tan Sri Muhammad Ibrahim has warned.
Muhammad said the country’s economy is not sufficiently effective in creating jobs with decent wages, as the current structure fails to deliver the high-value employment that is needed, local media reported.
“Although Malaysia’s economy appears strong in terms of macro indicators such as growth and competitiveness, this does not reflect the reality of people’s earnings and purchasing power,” he said.
He added: “When I first started working, my salary was around RM1,400 per month. Adjusted for roughly four per cent inflation to reflect real wages, that RM1,400 today would be equivalent to about RM600 in real purchasing power.
“If RM1,400 is measured at today’s value, a new worker should enter the labour market earning around RM7,000. Yet in reality, starting salaries currently range from only RM3,000 to RM4,000.”
Muhammad made the remarks while speaking as a panellist on the National Roundtable Dialogue (Rimbun 2.0) at the World Trade Centre Kuala Lumpur (WTCKL) yesterday.
He also suggested that the government base its data on tax records, pointing out the gap between positive economic indicators and the actual cost of living and purchasing power experienced by the public.
“In the current fiscal situation, we cannot afford to fund subsidies indefinitely. But if implemented correctly, we can balance the budget,” he said.
Muhammad further noted that there are numerous inefficiencies and wastage, as some aid reaches higher-income groups rather than those most in need. – May 10, 2026