GEORGE TOWN – Budget hoteliers in the country are objecting to a move to raise the minimum wage to RM1,500 on grounds that tourism has not recovered from the losses incurred during the Covid-19 pandemic while there is an acute shortage of workers in the hospitality industry.
Malaysian Budget and Business Hotels Association (MyBHA) deputy president Dr Sri Ganesh Michiel stressed that the announcement has caught the hotel operators off guard.
He said they simply do not have the money to pay our novice workers such a rate.
“We mean well but we are not earning much in the first place due to rising living costs. The need to compete for workers is another factor,” said the association’s deputy president.
Yesterday when addressing the annual Umno general assembly, Prime Minister Datuk Seri Ismail Sabri Yaakob disclosed that the minimum wage will be revised upwards from RM1,200 to RM1,500 from May 1, in meeting the rising living costs challenges.
“We do not agree as the decision is not fair to the industry players,” said Ganesh to The Vibes.
Such announcements will directly increase MyBHA members’ operating expenses and the only step that can be taken is to increase the selling price of services or products.
“This move will naturally anger and burden our consumers more,” Ganesh said.
He also believes that employers would have to lay off senior employees earning well or reduce the number of the existing employees, or not hire additional employees.
This will raise the country’s unemployment rate, he cautioned.
On top of that, most of the budget hoteliers are facing cashflow problems and it takes a long time to recover due to the sluggish recovery in tourism.
Malaysia’s leisure industry has generally witnessed a comeback but not at all levels which its operators and owners would profess, as rising living costs and shortage of workers have dented their ability to record pre-pandemic revenue levels.
“It doesn’t make sense at all when the salary is increased while the selling price of a product also goes up. Will consumers benefit from this move?” asked Ganesh.
It is best to defer the move for now, said Ganesh. – The Vibes, March 20, 2022
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