PETALING JAYA: The helping hand extended via Budget 2022 will help ease the rising unemployment problem and aid economic recovery, say business experts.

       With the JaminKerja initiative aiming to create 600,000 new jobs, the government expects the unemployment rate in the country to be reduced to less than 4% next year.

       Malaysia Employers Federation (MEF) president Datuk Dr Syed Hussain Syed Husman said employers were upbeat on the outlook for the employment market next year based on the targeted initiatives of Budget 2022.

       He described the RM4.8bil allocation to create 600,000 jobs under JaminKerja (Job Guarantee) as “positive.”

       “Employers were also encouraged with incentives such as (the subsidy of) 20% of the first six months’ salary, and 30% of the following six months’ pay for hired employees earning more than RM1,500.

       “We look forward to the tax deductions of RM2,000 to RM7,000 to upskill employees, not to mention the RM1.1bil allocated for training and upskilling programmes for 220,000 trainees,” he added.

       The Statistics Department had previously noted that the unemployment rate climbed to 768,700 persons or 4.8% in June, compared to 4.5% the month before.

       Syed Hussain said MEF was thankful that the government was setting aside RM2bil to continue with the wage subsidy programme that would benefit about 300,000 employees, especially those in tourism and related sectors that were badly affected during the Covid-19 lockdowns.

       The initiatives would help alleviate the unemployment situation which increased to 711,000 in 2020 from 508,200 in 2019, while youth unemployment rose to 12% or 314,000 persons in 2020 from 295,800 in 2019 (10.5%), he added.

       Syed Hussain said the MEF also welcomed the decision to extend the reduced Employees Provident Fund (EPF) minimum contribution rate of 9% until June 2022, and to allow small and medium enterprises (SMEs) to postpone income tax instalments for six months until June 30, 2022 as this would greatly help ease cash flow issues.

       “The RM100mil matching grants for smart automation for 200 companies in the manufacturing and services sectors would also assist them to transform and streamline work processes and move up the value chain,” he said.

       Economic director in the Prime Minister’s Office Shahril Hamdan said Budget 2022 had much emphasis on employment opportunities and financing for micro businesses and SMEs.

       The commitments stated in Budget 2022 budget gave hope that these two problems could be addressed better than before, especially with the economy having opened up, he added.

       To make these initiatives a reality, he said he hopes that conditions and bureaucracy from development financial institutions and government agencies could be eased up, especially in the financing of micro businesses and SMEs.

       “This is so that more entrepreneurs can receive the benefit as soon as possible,” said Shahril.

       ScaleUp Malaysia Accelerator co-founder and general partner Aaron Sarma welcomed the news that Cradle Fund Sdn Bhd would be allocated RM20mil to develop the MyStartup strategy that should create 5,000 jobs in over 2,500 companies.

       “Overall, this was a pretty compelling Budget for the startup ecosystem. It addresses nascent stage innovation, deep tech development and startup creation.

       “The RM20mil allocation is a good start and I am hopeful that grants and other benefits are on the way through the 12th Malaysia Plan,” Sarma said, adding that ultimately Malaysia still has a long way to go to get to the 5,000 new startups target set by the Malaysia Digital Economy Blueprint (MyDigital).

       “The key over the next few months is to focus on the execution of this plan. While it’s encouraging to announce these initiatives, what’s important is that they quickly materialise and reach the recipients,” he added.

       Malaysia Associated Indian Chambers of Commerce and Industry secretary-general Datuk Dr AT Kumararajah commended the RM40bil financing package for entrepreneurs, from small to big businesses, under the Semarak Niaga programme.

       The RM14.2bil carved out of the RM40bil Semarak Niaga fund especially for SMEs was a welcome shot for this business community to bounce back next year, he said.

       “This will hopefully be targeted towards the SMEs that need the cash flow urgently,” he said.

       However, Kumararajah said while the budget has been expansionary in nature, it will only succeed if a targeted approach is applied.

       The government, he said, must look at a new paradigm in reaching out to businesses, especially SMEs and the micro business community.

       He added that the government must also do more towards building consumer confidence, as 70% of the national gross domestic product is domestic-driven.