Number of people losing their jobs doubling every month since start of MCO

The number of people who have lost their jobs has been doubling every month since the start of the movement control order (MCO) in March to curb the spread of Covid-19.

According to a parliamentary written reply by the Human Resources Ministry, a total of 1,791 people lost their jobs in March and this number more than doubled to 4,127 in April.

The figure almost doubled again in May when 7,195 lost their jobs and more than doubled in June with another 19,352 people losing their jobs.

The parliamentary written reply was in response to a question by Ipoh Barat MP M Kulasegaran, who asked Human Resources Minister M Saravanan (photo, above) for an estimate on the number of employees who have lost their jobs due to the Covid-19 pandemic and how the government intends to address the issue.

The ministry said to date, 36,196 people under 1,377 employers have lost their jobs.

"28,779 involve permanent retrenchment while 7,417 involve voluntary separation schemes," it said.

The ministry said the retrenchment of workers is the prerogative of employers but government guidelines should be followed.

Among them included putting retrenchment as the last resort by first considering a freeze on new hiring, reducing work hours, salary cuts, or temporary layoffs.

"If retrenchment is inevitable, employers must first terminate foreign workers before considering local workers," it said.

However, a separate written reply by the ministry to Kapar MP Abdullah Sani Abdul Hamid (photo) suggested that the figures could be higher.

This was because the number of people registered for a loss of employment this year under the Employment Insurance System (EIS) stood at 50,825 as of July 1.

It said the EIS had paid out RM107.8 million to 66,204 claimants as of June 26, more than the sum of RM107.6 million claimed by 66,650 people for the whole of last year.

It added that the contribution to the EIS as of April is RM225.4 million. The whole-year contribution for 2019 was RM651.6 million.

The EIS is a fund in which all workers contribute 0.2 percent of their salary of up to RM7.90 a month. Employers must also provide a matching sum.

Employees who lose their job can claim from the fund where they will receive financial assistance for up to six months.

The newly unemployed will get 80 percent of their last drawn salary capped at RM4,000, translating to a maximum of RM3,200.

Subsequently, they will receive 50 percent in the second month, 40 percent in the third and fourth months, and 30 percent in the fifth and sixth months. - Mkini