by D KANYAKUMARI / pic by ISMAIL CHE RUS

International Trade and Industries Minister Datuk Seri Mustapa Mohamed (picture) dismisses claims that Malaysia will retrench 50,000 workers due to the rising cost of doing business this year.

Acknowledging that there may be retrenchments as Malaysia shifts from labour-intensive to knowledge-driven economy, Mustapa said the government is of the view that the retrenched workers will be reemployed while other new sectors will provide employment opportunities.

“However, changes in technology and industrial structure which resulted in workers’ displacement are features of the knowledge-driven economy, even in good times,” Mustapa said in a statement yesterday.

“It is therefore incorrect for some quarters to allege that 50,000 workers will be retrenched primarily due to the rising cost of doing business. “While there will be retrenchment, in our view most of those retrenched workers will be reemployed by new and expanding businesses and the total number of retrenchments this year may not be as high as claimed.” The minister said Malaysia’s sustainable economic growth of 5.9% in the first nine months of 2017 and forecast of around 5% to 5.5% in 2018 will have a further positive impact on employment opportunities.

“It is important to note that as at third quarter of 2017, the total employed persons increased to 14.48 million from 14.42 million in the previous quarter,” he said.

Mustapa said a large percentage of the retrenched workers from companies such as Seagate Technology plc, Hitachi Global Storage Technology Inc and Rubicon Technology Inc in Penang have been absorbed by other firms which are expanding their operations, such as Inari Amertron Bhd, Osram Light AG and Infineon Technologies AG.

In the three-year period from 2014 to 2016, Mustapa said new manufacturing projects have created over 153,000 jobs.

“An additional 32,700 jobs in the manufacturing sector will be created from the investment secured in the period January-September 2017. A number of new investments and expansion undertaken by companies last year have created more job opportunities in the country.

“Oil and gas companies are also starting to hire again, especially in the upstream and offshore businesses, as they seek to capitalise on the new found high oil price in recent times.”

According to Mustapa, the issue of employment opportunities were discussed in a dialogue with 21 members from the Federation of Malaysian Manufacturers (FMM) on Monday. Another issue discussed with the FMM was the hiring of foreign labour.

“They (FMM) continued to highlight the need to have a holistic review of policies on foreign labour, the need to enhance administrative efficiency and facilitation to promote a more conducive business environment,” Mustapa said.