Household income rising under Najib admin - Economist

KUALA LUMPUR: Concerted efforts by Prime Minister Datuk Seri Najib Tun Najib’s administration have churned out many success stories within five years.

While some economies are ‘cracking their heads’ grappling with their huge debts, rising jobless heads, Malaysia is forging ahead with its own ‘steady melodious rhythm’.

One of the not-to-neglect factors that should be made known is the increase in the household income amid steady Gross Domestic Product (GDP) growth since 2009, supported by ‘inclusive’ economic planning.

“If Malaysia can sustain decent economic growth going forward, it will likely see further improvements in the household income,” said chief economist of Malaysian Rating Corp Bhd (MARC), Nor Zahidi Alias.

“The 7.2 per cent annual increase in the average monthly income of our households is quite encouraging considering the inflation rate which rose by an average 2.2 per cent per annum on a Cumulative Annual Growth Rate (CAGR) basis.

“Food prices increased by 3.3 per cent per annum while transport costs climbed by 2.3 per cent per annum in the same period.

“So, the increase in household income has generally outpaced the increases in the cost of goods and services that households have to incur,” Nor Zahidi told Bernama.


The 2012 Household Income Survey recently found the average monthly income of Malaysian households rising from RM4,025 in 2009 to RM5,000 in 2012, an increase of 7.2 per cent annually.

The urban household monthly income increased at a rate of 6.6 per cent a year from RM4,705 in 2009 to RM5,742 last year, while the rural household monthly income rose 6.4 per cent annually from RM2,545 to RM3,080.

“That’s the positive part of it. In addition, in major cities like Kuala Lumpur, household income rose at a faster pace of 14.9 per cent and this helped compensate price increases which tend to be faster in urban centres,” he said.

Nor Zahidi noted that among the major factors that explained the increase in the household income are strong economic growth as evidenced by GDP growth over the past few years.

The other factors are favourable labour market with jobless rate at circa three per cent and government efforts such as Economic Transformation Programme and Government Transformation Programme which created jobs and business opportunities for the unemployed, he said.

Nor Zahidi oversees MARC’s macroeconomic research and analysis, focusing on domestic and major economies’ fiscal and monetary policy issues and economic outlook.

His insights provide sound macroeconomic perspectives for MARC’s credit ratings.

According to the survey, all states also recorded a better average monthly household incomes with Kuala Lumpur leading with the highest growth of 14.9 per cent from RM5,488 to RM8,586. — Bernama

(Source: The Borneo Post)