LABOUR COST IN MALAYSIA 2016 Final Report - National Labour Cost Survey 2016 (F | Page 15

1.1
Research Background
Labour cost is defined as follows in the Resolution concerning statistics of labour cost adopted
by the Eleventh International Conference of Labour Statisticians (Geneva, 1966):
For the purpose of labour cost statistics, labour cost is the cost incurred to the employer in the
employment of labour. The main objective of labour cost surveys is to compile measure of the
level, composition and evolution of labour cost to the employer. The data is used, inter alia, for
the analysis of the structure of labour cost, and the relationships between the different
components. Official estimates are generally used as measure of the evolution of total labour cost
over time, and are usually calculated at quarterly or yearly intervals.
Labour cost surveys are generally sample survey of establishments or enterprises, covering
establishments of above a certain size. As a rule, they cover formal sector wage earners and
salaried employees, while persons working at home, self-employed, family workers, directors
paid by fee, persons paid by commission only and working proprietors are usually excluded.
1.2
Research Objective and Scope
The Institute of Labour Market Information and Analysis (ILMIA) initiated the National Labour
Cost Survey in 2016 to begin compiling data to measure the level, composition and evolution of
labour cost in Malaysia. This is a nationwide survey of establishments in the private sector
covering formal sector wage earners and salaried employees.
Establishments across all industries were covered at 1-digit level of the Malaysian Standard
Industrial Classification (MSIC 2008), while occupations were covered at 2-digit level of the
Malaysian Standard Classification of Occupations (MASCO 2013).
The following three MSIC sections were excluded from the survey:
1. Section O: Public administration and defence; compulsory social security, which includes
activities of a governmental nature normally carried out by the public administration
2. Section T: Activities of households as employers; undifferentiated goods and services-
producing activities of households for own use
3. Section U: Activities of extraterritorial organizations and bodies
In terms of occupational categories, ‘Armed forces’ under Major Group 0 in MASCO 2013 was
excluded from the survey.
National Labour Cost Survey 2016: Final Report
12