UNEMPLOYMENT could double this year with as many as 60,000 people losing their jobs, compared with the previous annual average, the Malaysian Employers Federation (MEF) said.

MEF president Dr Syed Hussain Syed Husman said the largest impact of job losses is expected in the manufacturing and construction sectors. 

However, he acknowledged that the unemployment rate will be influenced by the economic situation, including the performance of small and medium-sized businesses in the coming year.

“We’ll have to wait and see what the 2023 budget has in store for SMEs. It won’t be a rosy year for businesses, but it is manageable,” he was quoted as saying in a Free Malaysia Today report.

“Government assistance is needed to help SMEs weather the impact of the Covid-19 pandemic and stay afloat,” he added.

Apart from the manufacturing sector, he predicted that businesses in the retail and service industries may also struggle, as they rely heavily on both domestic spending and international tourist arrivals. 

If people cut down on spending, we may see more retrenchments in these sectors, he said. 

“If we can hit our GDP growth target, it should be okay,” Syed Hussain said.

Bank Negara Malaysia estimated the economy will grow 4-5% this year.

On the other hand, the Federation of Malaysian Manufacturers (FMM) said that the job market will remain steady this year and the organisation is not expecting significant layoffs this year. 

FMM cited a recovering labour market, as evidenced by a decrease in the jobless rate to 3.6% in December. 

“Malaysia’s growth rate of 8.7% last year was reassuring for the business sector,” FMM president Soh Thian Lai said. 

“With continued efforts by employers to re-skill and up-skill existing workers, and government support to assist the unemployed to get the right skills to be gainfully employed, the labour market will remain resilient and strong in 2023,” he added. – February 19, 2023.