Malaysia’s MCO: a necessary price to pay?

In the global fight against the COVID-19 pandemic, Malaysia is one of the countries to face a brutal struggle. Fast forward from the start of the pandemic up until today, Malaysia is currently at their 3rd Movement Control Order (MCO), which is a nationwide cordon sanitaire measure to flatten the curve from the third wave of the virus in their homeland. In essence, all economic sectors are allowed to operate, but cross-district and interstate travel, and social/sports activities are strictly prohibited. 

Today, Malaysia’s unemployment rate stands at 4.8%, with the number of unemployed people jumping over 63% in 5 quarters. It is a crisis in itself, with the vicious cycle of businesses struggling to survive and the bleak job prospects in the market worsening the situation. In a study from official data, skill-related underemployment has reached an all-time high at 38%, highlighting the rising desperation of people having to turn to jobs beneath their skillset.

The pandemic has greatly depressed the employment outlook, with an increasing number of graduates unable to secure jobs and uncertainty continues to loom. As of now, even wage-boosting interventions have failed at compelling the labour market to generate higher productivity jobs. With survival at the forefront of businesses’ concerns, a lot more has to be done to extend support to these struggling businesses. As of 28 June 2021, the Malaysian Government has rolled out the Pemulih Stimulus Package, which is a 150 billion-ringgit fiscal spending initiative in the form of unemployment assistance, cash aids and wage subsidies. In this, special grants and support for small and medium-sized enterprises are also included.

Undoubtedly, Malaysia is in a crutch trying to balance the effects of shuttering sectors while shouldering the impact on their economy. However, at all costs, Malaysia is refusing to revert back to MCO 1.0, which is a full COVID-19 lockdown with all sectors shut. Malaysian Prime Minister Muhyiddin Yassin has firmly explained the risks of doing so, with the threat of a collapsing economy at the forefront. Thus, despite the calls for stricter curbs on the MCO, it is a fragile situation that needs careful management.

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This article is written with reference from:

Falak Medina, Ayman. “Malaysia’s Pemulih Stimulus Package: Supporting Businesses and Individuals.” ASEAN Briefing, 30 June 2021, Accessed 13 July 2021.

Hirschmann, R. “Malaysia: Skill-Related Underemployment Ratio.” Statista, Statista, 2 June 2021, Accessed 13 July 2021.

Lee Hwok Aun. “Barring Failures to Contain Potential COVID-19 Waves, Malaysia’s Economy and Labour Market Look Poised to Recover, Says a Researcher.” CNA, CNA, 18 Apr. 2021, Accessed 13 July 2021.