The government aspires to create 600,000 job opportunities involving RM6 billion under the Jamin Kerja job guarantee incentive in Budget 2022.
I can see you folks agreeing with the plan. But let’s no celebrate too fast because in the proposal, the responsibility to create jobs lies with the private sector.
This is a sticking point as Jamin Kerja operates on a sharing principle between the state and private sector with the largest share being absorbed by the employer.
The state will provide a subsidy of 20 percent of workers’ remuneration for the first six months and another 30 percent for the following six months.
Why would employers be interested in taking up the 80 and 70 percent remuneration burden at a time of crisis when the majority of employers are struggling to recover from tight cash flows, outstanding debts with banks, rental with land owners and are way behind in their utility payments?
Clearly, besides being a disincentive to the private sector it will also increase their business operating cost.
And neither will it reduce the problem of unemployment as envisaged by the government.
According to Levy Economics Institute, a job guarantee is a public option for jobs, where it is a permanent, federally funded and locally administered program that supplies voluntary employment opportunities on demand for all who are ready and willing to work at a living wage.
In sharp contrast to the Jamin Kerja initiative, job guarantee programs can decrease unemployment. It’s an approach adopted by governments to provide jobs to people who want to work at a time of crisis.
Here, employers are paid by the state to absorb workers. Alternatively, employers can request funds from the government to employ workers in say cutting edge technology jobs.
Either way, it is the interventionist role of government to keep unemployment down by making available funds to create jobs.
In this regard, the Malaysian government should review or reimagine its role as a protagonist in the labour market to achieve sustainable employment.
The government can start by providing a subsidy amount of RM1,500 monthly per worker for a period of 12 months, irrespective of labour market status, age, ethnicity, or gender. And provide skills training before they start at a work place.