E-commerce boom leads to growing pressure on postal services


KUALA LUMPUR – The boom of e-commerce has made consumers worldwide happy as their highly sought-after items from Europe, for example, can reach their doorstep without needing them to be in the physical store.

Likewise for e-commerce sellers in the rural areas, their products can now reach consumers globally.

According to investment bank JP Morgan Chase, Malaysia’s e-commerce market is worth US$4 billion and rising steadily, thanks to the high internet penetration in the country.

While sellers and consumers and happy that their products are now not bounded by trade borders, we take for granted the welfare of postal personnel who are facing a hard time.

While we shop and are happy that the delivery fee is cheap, little did we know that they are at the receiving end of the rat race in the postal services which continue offer the cheapest service.

Growing Crisis

That is what that is happening to our postal personnel worldwide, including Malaysia.

Recently, video clips and photographs of workers or a courier company throwing parcels and shouting at a sorting hub have sparked concerns among netizens and dissatisfaction among those receiving damaged parcels.

They were said to vent their anger due to problems over commission and wages.

While some might say they should have channeled their frustration in a better way, the root cause of such action should be addressed.

During these trying times where movements are restricted, online purchases have skyrocketed and people are purchasing literally everything, from clothes to electrical appliances, including all type of spices.

When we click on the “purchase” icon upon finishing our online shopping, we often choose the courier that often has the lowest delivery rate.

But little did we know that the lower the delivery rate, the lower the commission for the delivery partners and to make matters worse, there is no floor rate in delivery in Malaysia.

This has put pressure on postal services to keep their businesses afloat – it would not be conducive in the long run as companies will always be pressured to lower their prices, leaving them to cut back on employee benefits.

In Malaysia, there are 109 courier options from foreign services such as DHL and FedEX, national courier Pos Malaysia, as well as private players such as Pgeon.

Since the pandemic, many of those, who have since been unemployed, have become delivery partners for many courier services as part of the gig economy.

According to statistics, Malaysia has about four million gig economy players and the number is growing everyday, especially during the pandemic.

Left with no salary for months, the delivery partners are working day in day out just to survive with meager earnings. This has led to a growing community that is underemployed.

Not only that, most of them do not contribute to pension fund, not covered under the Social Security Organisation (SOCSO) and have no insurance at all.

Underemployment – Building concern

As COVID-19 continues to plague the job market, underemployment is a segment that has grown since the beginning of the health crisis.

Underemployment refers to a situation in which individuals are forced to work in low paying or low skill jobs compared to what they are capable of.

A case in point was a pilot was forced to become a postal delivery partner as his airline grounded many flights.  He has to content with RM3,000 or less a month compared with his previous salary of RM15,000.

According to the Department of Statistics Malaysia, the unemployment rate has reached 4.8 per cent in December compared from 4.7 per cent in November.

An analyst predicted that the numbers will continue to rise in February due to the second round of movement control order, leaving more small and medium businesses, as well as tourism players to close their doors indefinitely.

While these numbers continue to increase, indirectly the number of people joining the gig economy will also rise in tandem despite hardly any safety net is provided so far to the industry.

Protect delivery partners

Since the beginning of the pandemic, delivery personnel has become a bridge to customers’ happiness in obtaining what they want, from near and far.

It is high time for the government, industry and stakeholders to formulate a floor price for the delivery sector to safeguard the wellbeing of the postal partners.

If we can pay a minimal RM4 for a single delivery, we can surely contribute into ensuring our items can be delivered to our doorstep safely while the delivery partners obtain a decent commission to put food on their table.