Gaji Minima Perangkap Untuk Jatuhkan BN

Here is more about the minimum wages thing. Folks dont say I did not warn you. Here is The Star :

• Minimum Wage Could ‘Kill SMEs’
• a joint (Press) conference by 16 manufacturing, retail and service sector associations yesterday.
• Eighty per cent of SMEs could be forced to shut down if the Government's proposed minimum wage policy of between RM800 to RM1,000 is implemented across the board.
• The SMI Association of Malaysia said "..most of the SMEs are labour-intensive; they don't have modern machines. An increase in salaries will have a tremendous effect on the manufacturing cost,” he said, “It could totally kill SMEs because for most of them, their net profit margin is only around 3% to 5% .”
• The potential chain reaction could be grave as well, considering SMEs make up 99.2% of the Malaysian economy and accounted for 59% of the workforce.
• The majority of these SMEs are the supporting industry to many multi-national companies. So if manufacturing cost increase, they will be affected too.”
• the Malaysia Employers Federation's estimation that 200,000 SME businesses would suffer was realistic.
• The Malaysian Plastics Manufacturers Association president Lim Kok Boon said "...the plastics industry, about 75% to 80% were SMEs.."

The Government says that before they decided about the minimum wages, they had brainstorming sessions, the Government conducted studies, the Government pinjam their watches to the con-sultans and then asked the con-sultans for the time and many other clever things.

I have a more basic question : did the Goverment sit down and discuss things with the employers thmselves, the majikan? For example did the Government sit and talk with the 16 Small and Medium Enterpise (SME) associations mentioned above? Or the Chinese guilds? Or the Chambers of Commerce people?

If so, how come 16 of these associations made a joint Press statement yesterday disagreeing with the minimum wages policy. Why didnt the Government talk to these people? Do you mean that these industry associations who provide employment for 59% of the workforce were not consulted? What happened to "rakyat di dahulukan"?

Folks, there is going to be serious disaster in the land. I dont know how else to say this but the Gomen folks just do not know what they are talking about.

1. The Gomen screwed up the "plastic boxes to transport fish" and messed up the fish prices. When fish prices went up to the sky, the Gomen flip flopped. The Gomen did not listen to the fish wholesalers. They did not listen to OutSyed The Box either - I had blogged about it. They listened to the con-sultans.

2. Then they messed up the subsidies for the fishing boats. Fish prices went to the sky again. Soon the Gomen had no choice but to backtrack and flip flop. They did not listen to OutSyed The Box either because I had blogged about that too.

3. After that the Gomen messed up the 'old school buses' issue. They gave a ridiculously short time frame for the old school buses to be changed to new buses. The school bus operators simply said they will stop driving. So the Gomen back tracked and flip flopped again.

4. The Gomen then messed up the used car sales and registration of new cars issue. As a result, the used car buyers stopped buying used cars. When people could not trade in their old cars, new car sales also dropped to the bottom. The car industry almost died. And that time I had met the Minister in charge and blogged about the issue BEFORE they went ahead and implemented the fiasco. So the Gomen was forced to backtrack and flip flop again. Sekali lagi they did not listen to OutSyed The Box.

Folks all these fiascos have happened despite Pemandu, Pemudah, Penghisap Candu, ETP, GTP and dont know what else.

Now is the turn of this Minimum Wages - a major bungle, perhaps the Mother of all Bungles by the Gomen. This one is really going to kill the cat. No more nine lives after this.

If the Gomen really thinks this Minimum Wages Policy is so good, then please implement it before the General Elections.

Just implement the Minimum Wages for three months and see what happens. After that lets go in for the General Elections. I can assure you the country will have a new Government.

Then Tan Sri Muhyuddin can set up an SME to manufacture kopi jantan. Dato Sri Najib and Rosmah can try the "good quality used handbags" business.

If the Opposition had any brains and they really want to win the General Elections, then they too should fully support this Minimum Wages Policy. (This is where my concern is maybe the con-sultan who dreamed up this Minimum Wages Policy is an Opposition spy. Have you thought about that Dato Sri Najib and Tan Sri Muhyuddin?)

In three months, factories will start closing. People will start losing their jobs. Unemployment will go up. Inflation will start galloping. The BN will lose the general elections.

Some people say that Minimum Wages have been implemented in America, Europe and Australia. I would like to say "So what"? In fact that is what I want to say 'So what'?

Malaysia is NOT America, Europe or Australia. When America implemented their minimum wages policy they were already the wealthiest nation in the world with the highest per capita GDP in the world. Even the European countries and Australia were already rich countries with educated, productive and high income populations. They were definitely not poor countries.

The vast majority of their workers were already earning incomes way above the poverty line. They implemented their Minimum Wages policy from a position of strength, not from a position of weakness. Their Minimum Wages Policy was designed to help the minority of workers who fell through the cracks and suffered low wages.

This would include older and less educated workers, high school kids looking for summer jobs, the disabled and other such groups who often suffered poor wages. In the early 1900s child labor was rampant in the US. Women and children suffered serious wage discrimination at the hands of employers.

Minimum Wages in the US helps a small portion of their workforce. Here are some figures :

"(In the United States) Among those paid by the hour in 2009, 980,000 were reported as earning exactly the prevailing Federal minimum wage. Nearly 2.6 million were reported as earning wages below the minimum. Together, these 3.6 million workers with wages at or below the minimum made up 4.9 percent of all hourly-paid workers"

Folks, the total size of the giant American workforce is over 140.0 million workers. Minimum Wage workers make up 2.5% only of their workforce. I think similar figures would apply for Europe and Australia. These are rich countries where the vast majority of workers (97.5% of their workers in America) are productive and high income workers who earn money way above Minimum Wage.

Their Minimum Wage policies are designed to help the 2.5% or 3% minority who suffer specific issues. Their Minimum Wages is like a social welfare policy to help this 2.5% minority. It does not add significant costs to their economy that can kill businesses or send inflation soaring to the sky.

In contrast, Malaysia is not yet a rich country. We are only pretending to be rich. Unlike the US, we will be implementing Minimum Wages that will impact a large number of workers and huge sectors of our economy. For example, the SME's make up 99.2% of our economy and employ 59.0% of our workforce.

Minimum Wage works best in the rich countries, where the vast majority of the workers are already high income because of their education, skills and high productivity. They implement a Minimum Wage Policy as a social safety net for a minority of workers who may not have the skill levels prevalent in their society.

Think of it this way - should Indonesia and Bangladesh also have a minimum wage policy? Should Indonesia say 'all our workers should be paid at least RM350 a month' (this used to be the salary of an Indonesian maid in Malaysia not too long ago). Can the Indonesian economy sustain such a minimum wage policy? I dont think so.

They are a poor nation. They are not very productive. As a result their economy does not have enough jobs for their people. In Indonesia, India and Bangladesh there are so many people who are jobless that people will compete to work to earn a salary that is just enough to buy food.

Huge sectors of our workforce in Malaysia suffer low productivity. And this low productivity is increasing. Minimum wage will only cause more disruption.