Imagine what you could do with an extra RM200 every month, eat better or maybe start saving more?
Starting 1 February 2025, this dream will become a reality when the General Wage Order (GWO) increases the minimum wage from RM1,500 to RM1,700.
According to UOB Kay Hian Research, this wage increase, coupled with the salary adjustment for civil servants, is expected to inject RM20.4 billion into the economy, benefiting more than 6.05 million Malaysians.
The purchasing power of the people, especially the low-income group, is set to increase – and that's good news for retailers like 99 Speed Mart and MR DIY, who are expected to reap big profits.
In addition, RM5 billion from the EPF Account 3 withdrawal scheme will also increase the people's purchasing power.
However, with great opportunities come challenges.
One of them is the petrol subsidy which will be phased out starting mid-2025.
While this move could save the government RM8 billion a year, the price of petrol at petrol stations may increase, which will impact daily budgets.
While consumer sales in 2024 are expected to be flat, analysts are optimistic that this extra money could change the economic landscape in 2025.
With greater purchasing power, is this the best time to boost the economy?
