By Aidila Razak
Average nominal salary in the private sector grew by five percent in 2012, up from a growth rate of four percent the year before, Bank Negara Malaysia (BNM) said.
This, coupled with lower inflation of 1.6 percent in 2012 (down from 3.2 percent in 2011) painted a happier picture for the average Malaysian household last year.
According to the central bank’s annual report 2012, headline inflation moderated mostly due to “better-than-expected domestic food supply conditions and lower-than-expected inflation in the transport category”.
It observed that a drop in meat and vegetable prices last year saw household bills for food, transport and non-alcoholic beverages grow at a slower rate in 2012 compared to 2011.
BNM said that salary hikes occurred in both the private and public sector, with the introduction of the Malaysian Remuneration Scheme in the civil service.
This, it said, contributed to healthy growth of 7.7 percent in private consumption.
Average wage increment grew at a higher rate in both the manufacturing and non-manufacturing industry, although executives got bigger wage hikes.
“Increments for executives grew at a higher rate of 5.2 percent (as compared to 2011’s 3.7 percent),” it read.
Non-executive salaries increased by 4.7 percent, up from 2011’s rate of 3.9 percent.
Retrenchments up
Although employment grew at a higher rate, 2012 was not a happy year for the 11,494 people–mostly from the manufacturing sector–who got laid off last year.
This is a significant 22 percent higher than the number of retrenchments in 2011.
Belts were also tightened in the rural areas as rubber and palm oil prices declined by almost 30 percent.
“However, for the Felda settlers, this was mitigated in part by the payment of RM15,000, which had been disbursed in three phases to each settler in conjunction with the listing of Felda Global Ventures Holdings,” it said.
Government hand-outs to the low and middle-income also supported private consumption, it said.
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