The Malaysian Employers Federation (MEF) today welcomed the RM40 billion aid package announced by the government ahead of the current two-week lockdown but suggested that financial support in the form of wage subsidies be given to bosses to help prevent the retrenchment of workers.
MEF president Syed Hussain Syed Husman said the lockdown which came into effect today would make it extremely challenging for employers to remain sustainable without adequate support from the government.
In a statement, he said losses of about RM2.4 billion per day were expected, similar to those experienced during the first lockdown in March last year.
“To avoid retrenchment, employers would require financial support to retain all employees on their payroll so perhaps the government should consider giving wage subsidy to all employees earning RM4,000 and below, similar to the Prihatin economic stimulus package during MCO 2.0 which provided wage subsidy for six months from April 1 to Sept 30, 2020,” he said.
Previous reports said as many as 2.8 million people might lose their source of income while up to 40% of SMEs could be forced to close down as a result of a full lockdown.
Prime Minister Muhyiddin Yassin, who announced the lockdown on May 28, said it would take place in three stages with only essential services and sectors given the green light allowed to remain open during the first phase from June 1 to 14.
If Phase One succeeds in reducing the Covid-19 caseload, Phase Two will be implemented under which economic sectors that do not involve large gatherings and which can be subject to physical distancing will be allowed to reopen.
This is expected to continue for four weeks, after which Phase Three will be enforced. Under the third phase, most economic sectors will be allowed to reopen subject to strict SOPs.
Syed Hussain urged members of the public to register for vaccination, saying this would save lives.
“And the sooner we achieve herd immunity, the sooner we can return to business as usual,” he said.