LABOUR shortage and increasing production costs are affecting the furniture industry sector, especially in the capital of furniture-making – Muar – which could result in a dire end for those in the industry.

Labour shortage is the bigger issue and Muar will be badly affected if the issue is not resolved within six months, said the Muar Furniture Chamber of Commerce president Keh Wee Kiet.

The industry in the Johor town is said to be short of some 20,000 workers and the labour-intensive furniture industry is highly dependent on foreign workers.

Keh told The Malaysian Insight that Pakatan Harapan has not done much to resolve the labour shortage issue since taking office last May.

Muar accounts for a lion’s share of the total furniture produced in Malaysia – accounting for 60% or RM6 billion of the country’s total annual production of RM10 billion.

“Producers will have to limit orders if this is not resolved and this, in turn, will impact on earnings.”

The industry is also dragged down by high production cost and an economic slowdown, said Keh.

If there is no resolution to the problem, some industry players could shut down their factories, he said.

Production cuts, or even stopping production, will disrupt the supply chain, with Muar being the largest producer in terms of production value.

Scaling down on production and output will also result in difficulties retaining customers.

Keh added that the revision to the minimum wage policy only added to labour cost.

The minimum salary of RM1,050 has put on more pressure on furniture manufacturer’s operating cost, he said.

The Muar Furniture Chamber of Commerce has brought its grouses to the government’s attention and a memo was also sent to the prime minister.

The group has also met with Human Resources Minister M. Kulasegaran and Energy Science, Technology and Climate Change Minister Yeo Bee Yin. However, there have been no developments since.

“So far there is no news. We can only wait.”

Meanwhile, chamber secretary Kuo Lee Chuang said the industry will be in the doldrums in the absence of foreign workers, especially those from Bangladesh.

Bangladeshi workers are able to bring onto the table the skills required in the furniture industry, Kuo said. – March 24, 2019.