Mean monthly income per household Malaysia 2019, by ethnic group

In 2019, ethnic Chinese households had the highest mean monthly household income in Malaysia, at around 9.9 thousand Malaysian ringgit. This was more than 2.5 thousand ringgit higher than Bumiputera households. Despite the implementation of affirmative action through Article 153 of the Malaysian constitution, the economic position of the Bumiputera vis-à-vis other ethnicities still left much room for improvement.

Historical policies, ethnicity, and the urban-rural divide

The Bumiputera make up the majority of the Malaysian population, yet have one of the lowest average monthly household incomes in Malaysia. This economic disparity could be explained by the effects of colonial policies that kept the Bumiputera largely in the countryside. This resulted in an urban-rural divide that was characterized by ethnicity, with the immigrant Chinese and Indian laborers concentrated in the urban centers, a demographic pattern that is still evident today.

There was a considerable difference in urban and rural household incomes in Malaysia, with urban household income being around 3.6 thousand ringgit more than rural households. This was largely due to the fact that wages in urban areas had to keep up with the higher cost of living there. This thus impacted the average monthly incomes of the largely rural-based Bumiputera and the largely urban-based ethnic Chinese . This visible wealth inequality has led to racial tensions in Malaysia, and in 2018, the Pakatan Harapan government has had to balance policies to implement economic progress while at the same time ensuring that certain ethnic groups are not left behind.