Surviving on minimum wage

by Ivy Kwek, guest columnist. In February I started a little experiment for myself. Taking the cue from the recently announced minimum wage, which has been set at RM900 by the government (RM800 for East Malaysia), I decided to try to live within the means of the said amount. Much has been said about the suitability of the minimum wage, namely on whether it is possible and whether it is good for the economy. Even after the implementation of the minimum wage has been justified, the debate continues as to how much a minimum wage should be.  One side, particularly the business owners, claims that RM900/month is too high and unsustainable. The other side of the fence thinks that it is too low for survival. Yet, not many seem to be based on a more humane consideration – Just how possible is it to live with such meager salary? And if it is not, how could the other arguments even stand? Hence I decided to try it out for myself. The Essentials As a single person who lives in Bangsar), I pay a rent of RM370 per month for a room. I take the bus to work, which costs me RM1 per trip and hence RM2 per day, and hence approximately RM40 for 20 working days in a month (approximately RM10 extra for other trips outside of work). In addition, I pay a phone bill of RM50. That would leave me with RM430. Initially, I do not know how drastic a change I need to adapt in order to fit into the budget. I decided to take a gradual approach in changing my lifestyle. I still allow myself to do some minimal driving, particularly at night since I feel unsafe taking public transport at late hours. Furthermore, bus routes in Kuala Lumpur are only effective at limited destinations. Nonetheless, I manage to limit my petrol consumption to RM60. I made a trip out of KL, partly at the courtesy of others, of which I paid a nominal RM50, and I went home for Chinese New Year with the cheapest travel option available – round trip by bus –  that costs me RM70. Deducting all this non-food expenditures, I’m left with the balance of RM250. Assuming that I eat 2 meals per day, hence 60 meals in a month, I can only afford to spend less than RM5 a meal. I still eat out but opt for cheaper options, such as local stalls, particularly Mamak stalls. At the end of the month, my food bill came out to RM388, i.e. an average of RM6.50 per meal. Emergency and Festivals Of course, the attempt to fit the food expenditure into the budget is unrealistic as that assumed that no emergency fund would be needed. Indeed, an emergency situation did occur. On the 3^rd day of Chinese New Year, I fell down and hurt some joints which required a medical bill of RM47 (Fortunately for me, it will be reimbursed by my employer). Half way through the month, my phone charger decided to fail on me and I spent another RM30 to replace it (some might not agree that mobile phone is a necessity, but I would argue that it has become one in the increasingly technology-reliant society). In fact, when I was celebrating Chinese New Year, I was holding not more than RM200 in my wallet. I decided to ‘shrink’ my yearly Angpows for my parents to RM50 each, hence after the RM100 ‘fine’, I’m only down with some loose changes, of which I would have been done for. But thanks to the Chinese culture which favours the single person, I actually managed to collect enough Angpows to break even, with some surplus. Hence I survived. There are a few occasions when I struggled with social pressures. A few reunions with friends were being planned, and some were to take place in restaurants that could not fit my budget. I can’t expect others to follow suit, which is why some meals were more expensive. Due to other co-incidental factors, I actually skipped reunions twice. That would easily cost me another RM100 at RM50 per meal, each. On top of that, there are many hidden costs – I did not include my monthly allowance to my parents in the RM900 budget as it would make the experiment highly impossible. Moreover, the car I am using is inherited from the family and hence no monthly installments were needed; other essentials such as toiletries, electric goods and furniture have not worn out that month and hence did not incur expenditure. Compromises I’ve heard arguments, surprisingly many from young professionals, that it is actually possible to survive within RM900. My response would be: Can anyone afford not to? My point is, however little a person earns, one has to find ways to survive, indeed we have seen many workers who survived even before the minimum wage policy was implemented. The question of the exercise is not whether it is possible or not, but rather, what kind of compromises one needs to make when one has so little to sustain on? What would a low income earner need to be deprived of? Perhaps it would not make sense for a minimum wage earner to be spending almost half his salary on accommodation. That would mean that he/she has to either stay far away from town, which would then increase traveling costs, therefore reducing their quality of life/time spent with family; or share a room with someone else and compromise on his/her living condition and private space. It is perhaps not surprisingly now to know that many foreign workers who, until recently, earn below minimum wage, would cram themselves in a house, some up to 20 people under one roof. Of course, in some cases, especially for the migrant workers, accommodation is provided by employers. Secondly, one of the first aspects that a low income earner would have to give up is recreational activities or non-essential spending, or switch from the expensive options to the cheaper one. Hence, instead of shopping malls, I started going to parks (of which, unfortunately there are not many good ones in KL). Instead of patronizing cafes, I hang out at Mamak stalls to catch up with my friends. I only went for the movies once, courtesy of a friend, and have only bought a new T-shirt at RM17. More so, perhaps one of the most stressful parts of living on a minimum wage is the psychological pressure that comes with the lack of financial power – the need to track every bit of expense. Sometimes, this would mean forgoing the drink during meals (or snacks!), or sticking to the same type of food every day for the lack of choices; sometimes, bearing the hidden social discrimination for not being able to consume the way the ‘better-to-dos’ in your social circle actually do (especially in festivals and special occasions); sometimes, it would mean less convenient options (eg. public transport over private cars), sometimes, having no luxury to allow yourself to fall into a situation where emergency funds need to be employed (such as falling sick, having your money stolen or getting fines from the police). What happens when there are mouths to feed? When I first announced my intention to do this, many friends were initially interested in joining me, but eventually did not, due to concerns over their family, especially those with small children. Indeed, many of the minimum wage earners have families with dependents too. If it is so hard for a single person, how would it be like for a family with RM1800 (assuming that both the adults work and earn a minimum wage) or less? Meanwhile, our country’s poverty line is defined as a family of four earning less than RM763 per month. This would include children that are still feeding, or in schools, an age where nutrition and education is extremely important and cost-incurring. Yet, under the Malaysian statistical definition, a family is not considered poor if it earns more than RM763 per month. Multidimensional approach to poverty While I believe that the ultimate solution is to increase the disposable income for workers, there are also other policies that could improve the quality of life of low income groups. For example, better public transport with accessible routes and affordable fares, which can boost the mobility of the low income group without increasing their travel costs drastically; as well as more and better managed public spaces, such as community parks that are not profit-driven, as an outlet for leisure. While I used to disregard the effectiveness of the government’s and charitable organizations’ effort to provide short-term aid, such as low cost housing (eg. Program Perumahan Rakyat), affordable healthcare (eg. 1Malaysia clinic), and cheaper meal options (eg. Menu 1 Rakyat), I am now less skeptical about it, wishing only that it could be given more serious thought in its implementation, as well how they can serve the poor with dignity and not in a condescending manner. The Survival Project In the end, I did over budget, above RM900. Perhaps, as some might argue, that the expenditures can be further slashed to fit into that budget, say if I share my already small room with another person to halve the cost, strictly limiting every meal to less than RM5, or if I forego all kinds of cost-incurring recreation. But that would be a life of utmost deprivation, surely not a life of decent comfort.