Malaysian employees get lower pay due to Covid

by NUR HAZIQAH A MALEK / pic by BLOOMBERG

THE average monthly salaries and wages received by local employees declined last year to 9% from RM3,224 to RM2,933.

Chief statistician Datuk Sri Dr Mohd Uzir Mahidin said the health crisis hitting the country following the outbreak of Covid-19 left a profound impact on the country’s socio-economic landscape, which affected the salaries paid to the people.

“It was reflected by the decline in all states in 2020, with Johor registering negative 13%, followed by Terengganu (12.4%), Kuala Lumpur (KL) (12.3%), Labuan (11.5%), Sarawak (11%) and Selangor (10.6%),” he said during the virtual launch of the State Socio-economic Report 2020 yesterday.

Putrajaya recorded the highest average monthly and wages with RM4,497, while other states that exceeded the national average of RM2,933 were KL (RM3,823), Selangor (RM3,480), Negri Sembilan (RM3,013) and Labuan (RM2,942).

Additionally, travel restrictions across states and districts impacted the country’s domestic tourism industry, in which the domestic tourism expenditure plummeted 60.8% to a value of RM40.4 billion against the previous year’s RM103.2 billion.

“The arrival of domestic visitors also decreased by 44.9% to 131.7 million visitors compared to 239.1 million visitors in 2019.

“Among the states with the highest drop in the number of domestic visitors were Sabah (53.1%), Sarawak (52.5%), Johor (49.3%), Melaka (48.0%) and Terengganu (47.6%),” he said.

He said the report is particularly beneficial to policymakers in producing and managing resources in an efficient manner and subsequently assists in evidence-based decision making.

He added that it also stands as the instrument used in measuring the effectiveness of the state development agenda, especially in scrutinising an inclusiveness of welfare and socio-economic development.

“Moreover, the harmonisation of economic and social demographic statistics in this report will facilitate the administrative agencies, industry players, academicians and individuals in referring to one specific and comprehensive report to equip their understanding on the current situation of socio-economic indicators at state level,” he said.

Among others, the report stated that Malaysia’s gross domestic product (GDP) contracted by 5.6% in 2020, which was the second lowest after the 1998’s downturn of 7.4%.

Tourism-based industries such as accommodation, food and beverage, and transportation activities are the most impacted by the Movement Control Order implementation.

“The outbreak which has also plagued Malaysia’s major trading partners has affected demand for goods and services, which in turn squeezed the country’s export performance.

“Meanwhile, the higher unemployment rate was partially influenced by the implementation of retrenchments by the affected business organisations to sustain their operations,” he said.

All states posted negative growth in economic performance, although eight of them registered better growth magnitude against the 5.6% contraction of the national level.

Labuan recorded a contraction of 0.5%, followed by Kelantan (1.1%), Kedah (1.7%), Penang (2.1%), Perak (2.3%), Negri Sembilan (3.6%), Johor (4.6%) and Selangor (5.3%).

“Meanwhile, six states namely Selangor, KL, Johor, Sarawak, Penang and Sabah remained as the largest contributor to the national GDP with a total contribution of 72.1% against the previous year’s 72.3%,” he said.

As a consequence of the downward performance and trade activities, the country’s total trade in 2020 decreased 3.6% to RM1.78 trillion versus the previous RM1.84 trillion.

Mohd Uzir said Malaysia recorded a negative inflation rate of 1.2% in 2020.

“Among the most affected groups were transport which contracted by 10%, followed by housing, water, electricity, gas and other fuels (1.7%), and clothing and footwear (0.8%).

“Overall, the consumer price index of all states decreased between negative 0.6% to negative 1.9% in 2020,” he said.

For the labour market, the Labour Force Participation Rate (LFPR) at the national level fell to 68.4% against the previous 68.7%.

“However, at the state level, Labuan, KL, Perak, Penang, Johor and Sabah recorded a higher LFPR in 2020.

“The highest LFPR was recorded in Selangor with 75.4% followed by Putrajaya (72.5%), KL (72.1%) and Johor (70.4%) while the lowest LFPR were recorded in Kelantan with 57.9%,” he said.

Nevertheless, the annual unemployment rate in the country increased to 4.5% during the year, making it the highest rate after almost three decades.

“All states recorded an increase in unemployment rate where Sabah (8%), Labuan (7.2%) and Perak (4.8%) surpassed the national level (4.5%).