However, Rafizi said, the government had evaluated the impact of the new minimum wage before implementing it.

“The implementation of the minimum wage carries a risk of slightly increasing inflation. However, we will ensure the increase (in the minimum wage) strikes a balance between salaries and the cost of living,” he told reporters after an event here today.

The RM1,500 minimum wage came into effect last May. However, companies with fewer than five employees were exempted from the rule until the beginning of this month.

Rafizi said the implementation of the minimum wage ensures that people’s income increases periodically in line with the rising cost of living.

Separately, he said the country’s inflation rate decreased to 2.8% in May from 3.3% in April, marking the ninth consecutive month that inflation had declined.