The coronavirus pandemic-fuelled lockdown saw Malaysia’s unemployment rate jump to a four-month high of 4.8% in June, from 4.5% in May.
According to United Overseas Bank (UOB Malaysia), the number of unemployed in the country posted the biggest rise in 13 months by 40,600 – 5.6% month-on-month – to 768,700 in June. The labour force participation rate dropped to an 11-month low of 68.3%.
“During the lockdown period, only essential services and economic sectors such as food and beverage, utilities, security, health and medical care, transportation, banking, communication, as well as essential construction activities were allowed to operate at 60% workforce capacity amid a 10km-radius travel limit,” UOB Malaysia’s economists Julia Goh and Loke Siew Ting said in a research note.
As such, the total employment reduced considerably in June by 73,700 or 0.5% month-on-month to 15.3 million, after peaking at a record high in May of 15.37 million.
Earlier this week, Department of Statistics Malaysia (DoSM) chief statistician Datuk Seri Dr Mohd Uzir Mahidin stated Malaysia’s labour force faced a tough situation in June following the Full Movement Control Order, with only essential economic and services sectors allowed to be up and running.
He added that those who are actively employed, making up 83.6% of the total number of unemployed, posted a rise of 33,000 to 642,900 compared to May’s reading of 609,900.
“Those who were unemployed for less than three months accounted for 52.3% of the actively unemployed, while 9.8% were those in long-term unemployment of more than a year,” he said.
Moreover, former Finance Minister Lim Guan Eng has urged the government to take immediate action to help businesses and save jobs: “DAP (Democratic Action Party) reiterates our call for welfare assistance to be increased to RM1,000 monthly, including the unemployed to help their families survive. Clearly, there is a need for an immediate allocation of RM6 billion to create 300,000 new jobs, offering hiring incentives to employers of at least RM300 per month and wage incentives to workers of at least RM500 per month for a period of two years to reduce the unemployment rate.”