Malaysia's Progressive Wage Policy (PWP) continues to gain momentum, with the latest parliamentary figures showing that 51,363 workers have received salary increases through the programme.

As of 5 June 2026, 4,025 private-sector employers have participated in the initiative, while the government has disbursed more than RM64 million in cash incentives. Participating workers also recorded a 13.8% median wage increase, with salaries rising from RM2,100 to RM2,390.

If you're an employer looking to improve employee retention while benefiting from government support, here's what you need to know about the Progressive Wage Policy.

What Is the Progressive Wage Policy?

The Progressive Wage Policy (PWP) is a government initiative introduced to encourage employers to provide structured wage progression for employees.

The policy aims to:

Encourage sustainable salary growth
Improve workers' income through wage progression
Support productivity and skills development
Strengthen Malaysia's labour market
Help employers invest in long-term workforce development

Unlike Malaysia's minimum wage, which sets the legal minimum salary employers must pay, the Progressive Wage Policy is designed to encourage employers to voluntarily provide salary progression with government support. (Human Resources Online)

Latest Government Results

According to the Ministry of Human Resources' written parliamentary reply, the programme has achieved encouraging results.

Results	Figures
Workers who benefited	51,363
Participating employers	4,025
Government incentives disbursed	RM64.08 million
Median monthly salary before PWP	RM2,100
Median monthly salary after PWP	RM2,390
Median salary increase	13.8%

The ministry said these figures demonstrate the programme's positive impact on improving wages while encouraging employers to adopt progressive wage practices.

Industry Participation

The highest participation in the Progressive Wage Policy comes from the following sectors:

Sector	Participation
Wholesale & retail trade (including motor vehicle and motorcycle repair)	26.7%
Manufacturing	15.7%
Professional, scientific & technical activities	11.1%
Education	7.4%
Accommodation & food service activities	6.9%

These figures show that employers across a wide range of industries are participating in the programme, with wholesale and retail businesses recording the highest uptake.

Employer Participation by Company Size

The programme has attracted businesses of different sizes.

According to KESUMA:

Company Size	Share of Participating Employers
Small companies	50.2%
Large companies	18.4%
Medium-sized companies	18.4%
Micro enterprises	13.1%

The figures indicate that small businesses make up the largest group of employers claiming PWP incentives, highlighting the programme's relevance for SMEs.

Progressive Wage Policy vs Minimum Wage

Although both policies relate to employee wages, they serve different purposes.

Progressive Wage Policy	Minimum Wage
Voluntary government programme	Mandatory legal requirement
Encourages salary progression	Sets the minimum salary employers must pay
Includes government cash incentives	No employer incentive
Focuses on long-term wage growth	Ensures minimum wage protection

The Progressive Wage Policy complements Malaysia's existing minimum wage framework by encouraging employers to provide structured wage progression beyond the statutory minimum.

What the Latest Results Mean for Employers

The latest figures suggest that more employers are recognising the value of structured wage progression.

With over 51,000 workers benefiting from salary increases and more than RM64 million in incentives disbursed, the programme demonstrates how government support can help businesses improve employee wages while strengthening workforce development.

The strong participation from small companies also indicates that the programme is being adopted by SMEs, not just large organisations.

FAQs

Is the Progressive Wage Policy compulsory?

No. The Progressive Wage Policy is a voluntary government programme for eligible employers.

Which employers have participated in the programme?

As of 5 June 2026, 4,025 private-sector employers had participated in the Progressive Wage Policy.

How much government support has been provided?

The government has disbursed more than RM64 million in cash incentives under the programme.

How many workers have benefited?

The latest parliamentary figures show that 51,363 workers have received salary increases through the Progressive Wage Policy.

How much have salaries increased?

Participating workers recorded a 13.8% median salary increase, with median monthly wages rising from RM2,100 to RM2,390.

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