Breaking News : Unemployed Malaysians Rose By 17.1% To Over 600,000 In March 2020 - Estimate That 2.4 Million Malaysians Might Be Unemployed - The Coverage
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Breaking News : Unemployed Malaysians Rose By 17.1% To Over 600,000 In March 2020 – Estimate That 2.4 Million Malaysians Might Be Unemployed

The number of unemployed people rose by 17.1% to over 600,000 in March due to the impact of the movement control order (MCO), the Department of Statistics revealed today.

The MCO, enforced on March 18 to contain the Covid-19 pandemic, saw many sectors and services closed before restraints were relaxed under a conditional version this week.

Chief statistician Mohd Uzir Mahidin said about 610,500 were left jobless in March 2020, compared to 521,300 in the same period last year.

“The unemployment rate in March 2020 increased to 3.9%. This high unemployment rate was mainly attributed to the adverse impact of the MCO on the labour market,” he said in a statement.

Uzir said the highest unemployment rate in the country was recorded at 7.4%.

The unemployment rate in March also caused the increase in unemployment rate for the first quarter of 2020 to 3.5% from 3.2% in the fourth quarter of 2019.

“The unemployment rate was the highest recorded since the second quarter of 2017,” he added.

The number of those unemployed for the first quarter of 2020 increased 5.8% to 546,600 compared to the same quarter last year.

Graduates accounted for 29.3% of the total number of unemployed people.

“Youths aged between 15 and 30 recoded the highest unemployment rate (6.9%) followed by those aged between 31 and 45 (1.4%) and those aged between 46 and 64 (1.1%),” the department said.

It added that semi-skilled workers dominated the labour market (59%), followed by skilled workers (27.8%) and low-skilled workers (13.2%).

Meanwhile wholesale and retail sales recorded a negative growth of 5.7% in March 2020 against the same period last year.

The department said this was the lowest growth registered since February 2013.

It attributed the drop in sales to the -15.3% contraction in motor vehicle sales.

“Retail decreased to 6.6%, partly due to the decrease in the sale of automotive fuel and sale of non-essential products,” Uzir added.

This includes the sale of household goods as well as information and communication equipment, among others.

Opinions split over prediction of 2.4 million unemployed

A think tank’s estimate that 2.4 million Malaysians might be out of a job if the movement control order (MCO) were to be extended has invited differing opinions, with an economist and a recruitment firm divided over the impact that a prolonged period of restraint might have on employment.

Mohd Afzanizam Abdul Rashid, chief economist at Bank Islam Malaysia Bhd, agreed that unemployment would spike.

However, he said it would not increase as much as predicted by the Malaysian Institute of Economic Research (MIER).

“Businesses have been impacted by Covid-19, so naturally they will reduce their manpower to lower operation costs.

“But measures by the government to preserve the cash flow among small-medium enterprises (SMEs) and corporates may help mitigate the risk of higher retrenchment,” he told FMT.

Afzanizam said the Malaysian Employers Federation (MEF) had previously estimated some 100,000 job losses after the outbreak.

But even then, Afzanizam who last year predicted a “guarded” job market in 2020 said based on his conversations with MEF, the job loss estimates were “on the conservative side”.

He also said it would come as no surprise if more people became unemployed during this period, adding that tourism-related sectors, aviation and the manufacturing and services industries would likely see the highest retrenchment.

MIER, in a report yesterday, said the 2.4 million expected to lose their jobs would consist mainly of non-salaried workers with unskilled workers making up 67% of the number.

Its report came just before Putrajaya announced a two-week extension of the MCO until April 14.

Afzanizam said the measures taken by countries across the globe to contain the spread of Covid-19 would mean more gloom for the job market.

“What we are dealing with now is a virus pandemic that will bring the economy to a near-standstill,” he said.

Sam Haggag, the country manager for recruitment firm ManpowerGroup, said it was still too early to gauge the MCO’s impact on the job market.

However, he expects a significant impact on those employed at SMEs where much of the concern revolves around cash flow.

In other sectors such as e-commerce, he said, there is actually potential for growth as the restrictions of movement under the MCO are causing an increase in online shopping.

He said this trend would likely continue beyond the Covid-19 crisis and “ultimately create sustainable growth”.

He also said there are still vacancies in the job market for those who are open to starting a new career, including in a different industry.

“Opportunities for work will be there for those with an open mindset,” he said.

He added that the current crisis is forcing companies to rethink their plans and to become more creative about how to retain talent.

Companies that are more proactive in this would rebound the quickest, he said.

When asked if employers should rethink their workforce planning and provide more flexibility for their workers, he said this would be key to surviving the Covid-19 crisis and beyond.

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