In this webinar, Mr Andrew Lo and Datuk Hj Shamsuddin Bardan shared their observations of the most significant impacts of COVID-19 and the most important lessons Malaysia should take heed of from the crisis.
MALAYSIA STUDIES PROGRAMME WEBINAR
Wednesday, 14 April 2021 – The ISEAS – Yusof Ishak Institute organised a webinar on “COVID-19 Damage Done and Lessons Learnt: Malaysian Workers’ and Employers’ Perspective”, delivered by Mr Andrew Lo and Datuk Hj Shamsuddin Bardan. Mr Lo is the CEO of the Sarawak Bank Employees Union and has served as Secretary of Malaysian Trades Union Congress (MTUC) Sarawak since 1999. He is also a member of National Labour Advisory Council (NLAC). Datuk Shamsuddin is the Executive Director of the Malaysian Employers Federation (MEF), and represents MEF on the National Wages Consultative Council and the NLAC.
Mr Lo started the webinar with an overview of Malaysia’s unemployment figures published by Department of Statistics Malaysia (DOSM) since January 2020. Unemployment rate spike from 3.2 per cent in January to 5.3 per cent in May with the implementation of Movement Control Order (MCO) in March 2020. Close to 100,000 Malaysians were retrenched in 2020, according to number of claims filed for Employment Insurance Scheme (EIS). Despite a slight improvement during the second half of 2020, Mr Lo cautioned that the present 4.8 per cent unemployment rate obscures the severity of economic crisis. Underemployed Malaysians are not included in the unemployment statistics, despite experiencing a fall in income due to a reduction in working hours or days at work. Mr Lo commented that employees in the private sector were the most affected, since private firms suffered a huge drop of revenue during MCO with the cessation of non-essential operations. He opined that the existing assistance schemes were inadequate since much of the cash transfers came from the savings of Malaysians rather than governmental fiscal injections. For instance, more than 6 million Malaysians applied for early withdrawal from account 1 Employee Provident Fund (EPF), with the total approved amount close to RM 55 billion. The largest share of withdrawals came from low-income Malaysians who are presently employed, even though the early withdrawal scheme was originally intended to assist Malaysians who have been retrenched. While the early withdrawal from EPF helps to tide through the present economic difficulties, it would erode their retirement savings. Mr Lo argued that Malaysia needs to enforce COVID-19 Standard Operating Procedure (SOP) at a consistent manner to restore social trust and compliance, as there were reported cases where politicians in the ruling administration were seemingly exempted from the SOP.
Datuk Shamsuddin begun his speech by presenting the DOSM survey which measured the effects of COVID-19 on private companies. About two-thirds of Malaysian firms had no sales or revenue during the March to May MCO, and had to rely primarily on savings to tide through. Despite exemptions for essential industries to continue their operations, the application process was hindered when Ministry of International Trade and Industry’s online portal crashed. In addition, the closure of non-essential firms had an impact on the supply chain and a record 100,000 firms permanently ceased operations in 2020 (compared to 40,000 in 2019). Datuk Shamsuddin commented that the Wage Subsidy Program launched since April 2020 – at a cumulative bill of RM 18 billion as of end 2020 – was inadequate as the government subsidies accounted for less than 10 per cent of the total wages paid by employers in 2020. Datuk Shamsuddin recommended that the National Employment Council should incorporate in-demand skills into the education system for Malaysian graduates to be employable. He also urged the Technical and Vocational Training Council (TVET) to design curriculum which are industry and future oriented.
In the question and answer session, topics discussed include the necessary labour market reforms and a possible rise in minimum wage. The webinar attracted 60 participants from Singapore and abroad.