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ECONOMISTS view the job guarantee initiative in Budget 2022 that will create 600,000 new job opportunities as a clever strategy by the government as it would support Malaysia’s economic recovery.
PwC Malaysia deals partner of economics and policy Patrick Tay reckons that this initiative is a “clear strategy” by the government to support the country’s economy and in turn, more jobs would be created as the economy recovers.
“The strategy by the government is not to have bad news of high unemployment rate derailing the economic recovery. And eventually once the economy recovers, it would create jobs which should help the unemployment rate ease,”he tells StarBizWeek.
Known as “Jamin Kerja Keluarga Malaysia” (JaminKerja) initiative, the government will channel RM4.8bil allocation for this initiative under Budget 2022.
Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz says this concept aims to address the country’s unemployment rate, adding that close to 750,000 Malaysians are unemployed currently.
”As you all know, Covid-19 has had a significant effect on jobs and sources of income, and unemployment rose to 5.3% in May last year.
“The figure has since dropped to 4.6% in August, (but) nearly 750,000 of our people must be assisted,” he says when tabling Budget 2022 in Parliament.
Notably, the government targets employment of 15.5 million and lower unemployment rate of 4% next year.
Similarly, UOB senior economist Julia Goh echoes similar views, saying that the job guarantee scheme is a key measure to improve employment and labour market prospects in the country.
“This scheme would jump-start hiring, and in return, the unemployment rate should ease with favourable economic prospects,” she says.
Without the JaminKerja scheme, AmBank Group chief economist Anthony Dass cautions that graduates and youth unemployment as well as underemployment would increasingly become a part of the country’s broader structural growth challenge in the coming years.
Having said that, Dass is optimistic that the initiative would help provide some ease in the unemployment rate to some degree.
However, he points out that the key challenge lies in the types of jobs offered and whether Malaysians would take-up the new jobs. “This remains a challenge unless the jobs offered are more contemporary in relation to the new economic norms such as digitalisation and tech-driven jobs,” says Dass.
It is important to note that this initiative will also be adopted by Socso which aims to provide 300,000 job opportunities with an allocation of RM2bil.
Under this initiative, employers will benefit from hiring jobless Malaysians, where the government will subsidise 20% of workers’ salaries for the first six months and another 30% for the following six months, subjected to jobs that offer remuneration of RM1,500 and above.