DESPITE the pandemic easing and Malaysians returning to their routines, many are grappling with the lingering effects of inflation. The prices of essential items, particularly food and daily necessities, continue to soar, causing financial strain for many Malaysians.

Even with a substantial 35% increase in salary over the past year, some of my acquaintances still find it challenging to keep up with the escalating costs. Presently, the average expense for a meal ranges from RM12 to RM15, while popular beverages like Milo, teh tarik, or soft drinks cost between RM3 to RM4.

When we calculate the daily and monthly expenses for food and drink (three meals a day), it amounts to RM57 per day or RM1,710 per month.

Moreover, when factoring in other financial commitments such as car and housing loan instalments (averaging at RM1,000 and RM2,000 per month, respectively), the total monthly expenditure could easily surpass RM4,700.

Emir Research recently stated in an article titled “Addressing the escalating crisis of youth violence in Malaysia” that 47% of 25 to 34 years old Malaysians were underemployed in 2022. This indicates that despite these group of young Malaysians have completed bachelor or postgraduate degree, they had to take low-paying jobs for survival. 

Another think tank, Khazanah Research Institute indicated in its recent report that in 2021, 65% of graduates started under RM2,000, with only 10% earning above RM3,000. This means that the amount of salary received during 1990s (i.e., RM1,800 per month) is still relatively similar to the 21st century (i.e. RM2,300, which only increased by 27.8%). 

No doubt the Employees Provident Fund (EPF) Account 3 offers an option for Malaysians to withdraw funds for emergency use. But is that be a viable solution in the long term? 

From May 11 to August 31, EPF members may choose to transfer funds from Account 2 to Account 3. The EPF contributions will be separated into three accounts: 75% going into Account 1 (Akaun Persaraan); 15% into Account 2 (Akaun Sejahtera) and 10% into Account 3 (Akaun Fleksibel).

For those with more than RM3,000 in their Account 2, a third of the balance will be transferred to Account 3 while one-sixth will be transferred to Account 1. The remainder will be retained in Account 2.

While the unity government acknowledges the need to address the cost of living crisis, concerns linger over the effectiveness of such measures in improving living standards. Rather than relying solely on EPF withdrawals, alternative solutions such as a productivity-linked wage system could offer sustainable relief by providing higher-paying jobs for ordinary Malaysians.

The adoption of such measures could prevent individuals from resorting to multiple jobs to cope with rising expenses. I’ve heard numerous stories of Malaysians juggling four to five jobs, including one full-time position, just to make ends meet.

In addition to implementing a productivity-linked wage system, the current unity government must also explore strategies to boost local food production. Malaysia’s heavy reliance on imported food supplies has contributed to soaring food prices. By restructuring the existing wage structure and placing greater emphasis on local agricultural production, the Malaysian government could gradually assist more Malaysians in alleviating their financial burden. – April 26, 2024.

* Amanda Yeo reads The Malaysian Insight.
 

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.