Why do Bumiputeras form the majority of the B40 income band?

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Bumiputeras constitute the majority of the B40 income band due to a confluence of factors including unbalanced development and lower labour force participation.

The majority of individuals within the B40 income bracket are Bumiputeras, a situation exacerbated by historical and ongoing inequalities. States with a high Bumiputera population, specifically Sabah, Sarawak, Kelantan, and Kedah, exhibit the most significant poverty rates. This is largely attributed to unbalanced development across wealth, income, education, and infrastructure, leading these regions to have the highest proportion of households earning below RM7,000. Furthermore, the economic growth in Sabah and Sarawak has lagged behind the national average over the past five years.
Unbalanced Development and Regional Disparities

Significant disparities in wealth, income, education, and infrastructure have contributed to the concentration of poverty in states with predominantly Bumiputera populations. Sabah, Sarawak, Kelantan, and Kedah consistently show higher percentages of households with incomes below RM7,000. The economic performance of Sabah and Sarawak, in particular, has been notably slower, averaging less than the national economic growth rate of 2.7 per cent per annum in the last five years. This persistent imbalance hinders upward economic mobility for a substantial segment of the Bumiputera community.
Lower Labour Force Participation

Bumiputeras also exhibit a lower rate of participation in the labour force compared to other ethnic groups. The labour force participation rate for non-Bumiputeras is higher, while the Bumiputera rate stands at 65.8 per cent, the lowest among all ethnic groups in Malaysia. This lower engagement with the workforce directly impacts earning potential and economic stability.
Educational Attainment and Unemployment

A correlation exists between higher educational attainment among Bumiputeras and unemployment. Those with post-secondary education constitute the largest proportion of unemployed individuals when compared to other ethnic groups. This suggests challenges in translating educational qualifications into employment opportunities for the Bumiputera population.
Historical Context of Socioeconomic Policies

Since the introduction of the New Economic Policy (NEP) in 1971, various programmes have aimed to provide socioeconomic opportunities and facilitate upward mobility for Bumiputeras. Over the decades, this has evolved with the establishment of specific organisations like Unit Peneraju Agenda Bumiputera (Teraju) and schemes such as the Bumiputera Economic Transformation (BETR) programme. Despite these long-standing initiatives, the persistent economic disparities indicate that these measures have not yet yielded comprehensive success in elevating the majority of the Bumiputera population out of lower income brackets.

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Why do Bumiputeras form the majority of the B40 income band?

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