Centre For Future Labour Market Studies

Centre For Future Labour Market Studies EU-ERA is an advanced research centre that focuses on the labour market research and analytics.

28/06/2024

BRICS is a group of emerging economies including Brazil, Russia, India, China, South Africa, Iran, Egypt, Saudi Arabia and the UAE, aiming to challenge the dominance of wealthier Western nations.

Joining BRICS could significantly benefit Malaysia's financial development, infrastructure growth, and trade, especially with China. Development financing and investment from BRICS could boost Malaysia's infrastructure projects and open new markets for its goods and services.

However, for Malaysia to achieve sustainable and prosperous economic development, it must carefully balance these opportunities with its existing relationships with Western allies. BRICS is seen as countering Western dominance, and aligning too closely might strain ties with key partners like the US and EU, risking diplomatic friction and economic repercussions.

Geopolitically, Malaysia’s influence could grow, but it needs to navigate its interests within BRICS while maintaining a neutral stance. In an interview with Chinese media outlet Guancha, the Prime Minister stated that Malaysia is preparing to join the BRICS group which is a step against Western control and asserting Malaysia's independence in the global discourse.

As Malaysia considers its potential membership in BRICS, how will it balance the benefits of economic cooperation with BRICS against the challenges of maintaining strong ties with Western countries?

Despite producing skilled labour every year in large numbers from local and foreign universities, the problem of fully m...
25/06/2024

Despite producing skilled labour every year in large numbers from local and foreign universities, the problem of fully meeting the demand for skilled labour still exists. This raise question: where does this skilled labour go?

Many skilled workers prioritize wage considerations and concern on achieving work-life balance. They frequently seek higher wages that suits with their skills. The Ministry of Investment, Trade and Industry (MITI) notes that low wages are a key factor in the shortage of local skilled labour, particularly in manufacturing sector and professional, scientific and technical industries. In Q1 2024, a total of 1.93 million labourers are working below their qualifications (Department of Statistics Malaysia, 2024)

If this problem is not prevented in the long term, due to lack of skilled workers, thereby potentially hindering Malaysia's economic growth prospects. Given this issue, what measures should the government consider implementing to address this problem effectively?

Share your thoughts with us.

The transition to targeted diesel subsidies in Malaysia is a strategic move aimed at enhancing fiscal efficiency. Econom...
19/06/2024

The transition to targeted diesel subsidies in Malaysia is a strategic move aimed at enhancing fiscal efficiency. Economists project this change could save the government expenditure up to RM8 billion. These savings can be redirected other initiatives like cash assistance and improvements in education and health facilities.

There is concern among the public, particularly consumer, about the non-subsidized diesel price at RM3.35 per liter, as this is expected to lead to high price of goods and services. Previously, the subsidized diesel price was RM2.15 per liter indicates a significant increase at 55.8% of diesel prices in Malaysia. However, SME Bank reports that inflation has could rise by 0.1%, indicating that the focused subsidy approach and gradual implementation have effectively contained inflationary pressures.

The transition of subsidized to non-subsidized diesel prices could triggered a domino effect across various sectors, impacting costs even though the cash assistance is distributed. Given these potential economic impacts, how prepared is the government to support affected businesses and consumers?

SELAMAT HARI RAYA AIDIL ADHAWishing everyone a joyous Eid Adha. This celebration remind us of the importance of sacrific...
16/06/2024

SELAMAT HARI RAYA AIDIL ADHA

Wishing everyone a joyous Eid Adha. This celebration remind us of the importance of sacrifice and dedication, values that are essential for inclusive prosperity. May this Eid inspire faith, unity and progress for everyone.

From us, EU-ERA, THE FUTURE

Malaysia has introduced GST in 2015 aimed to broaden the tax base and boost revenue. However, this tax had failed due to...
14/06/2024

Malaysia has introduced GST in 2015 aimed to broaden the tax base and boost revenue. However, this tax had failed due to delayed refunds, tax evasion, and its regressive impact on lower-income households. Rising prices and compliance costs led to its repeal in 2018. This raises the question: is GST an inefficient tax?

Some experts see it as an effective revenue generator, while others believe it burden low-income earners. Despite the debates, many developed countries have implemented this form of taxation and have established various practices for its application.

Narayanan and Abdul Latif (2024) highlight that Malaysia isn't alone in struggling with GST. Countries like Malta, Grenada, Ghana, and Belize faced initial challenges, leading to GST repeal. However, after adjustments, they reintroduced GST, improving revenue collection and fiscal stability.

They emphasized the need for thorough preparation if Malaysia reintroduces GST. Such as, focus on tax credits and subsidies for low-income households, efficient refunds, and continuous monitoring. Timing with economic conditions is important for GST to support fiscal sustainability and growth.

Given these considerations, should GST be reintroduced in Malaysia?

13/06/2024

Malaysia stands out when it comes to retirement planning for its workforce. The system is a two-pronged attack, with both a Public Pension Scheme and the Employees Provident Fund (EPF).

In January 2024, Deputy Prime Minister Zahid Hamidi announced a significant change to the public pension scheme. New government recruits will no longer be automatically enrolled, necessitating a more proactive approach to retirement planning for all.

This change has understandably caused concern among public service workers about their future financial security. Did you know that Malaysia has one of the highest contribution rates in the world, with a combined employer and employee contribution of 23% to 24%?

Understanding the intricacies of the EPF and how it compares to pension systems in other countries will empower us to make informed decisions and build a better retirement plan.

Malaysia's universities are climbing global ranks, boosting the country's educational competitiveness, particularly in h...
10/06/2024

Malaysia's universities are climbing global ranks, boosting the country's educational competitiveness, particularly in higher education. This recognition highlights their academic excellence and research output.

However, these rankings don't always reflect labor market outcomes. Lower ranks in Employment Outcomes may indicates that graduates are still face challenges in employability and applying their education practically to contribute to society.

Despite higher universities rankings, youth unemployment rate has stayed above 6% since 2015 (Labour Force Survey, DOSM), higher than the overall unemployment rate.

This issue may highlight the need for policymakers to further bridge the gap between higher education and the job market. Improving this connection is crucial for enhancing employability and societal impact.

21/05/2024

Many countries have implemented carbon taxes to mitigate climate change and drive economic benefits, including Finland, Sweden, Norway, Canada, and the EU. These taxes aim to reduce greenhouse gas emissions and promote a more sustainable economy.

Evidently, carbon emissions could significantly harm the economy by causing losses in agriculture, labor productivity due to deterioration of activity, and industrial output such as fishery output due to climate change. Irresponsible carbon emitters, such as certain companies and individuals, contribute to these economic losses, hindering both national and societal growth.

To soften these economic losses, the introduction of carbon taxation can boost the economy by fostering low-carbon development through investments in green technology, reforestation, and climate-resilient infrastructure. Governments can use tax revenue to fund these initiatives, promoting environmental sustainability and sustainable economic growth.

Take an example of a benchmarking country, Sweden, the Swedish carbon tax has effectively incentivized behavioral changes and spurred investments in renewable energy, resulting in a 29% reduction in carbon emissions since 1990. Despite challenges in isolating its impact, evidence suggests a significant effect attributable to the tax, contributing to Sweden's economic growth and faster decoupling from carbon emissions compared to other European countries.

Success stories suggest promising prospects for Malaysia. Implementing a carbon tax could reduce emissions, foster sustainable economic growth, and create green sector opportunities. Channeling tax revenue into renewable energy and climate-resilient infrastructure could enhance environmental preservation and economic prosperity. Could Malaysia achieve similar effects?

An engagement session was conducted with the Sweden Embassy in Kuala Lumpur, Malaysia, to explore Sweden's policies and ...
20/05/2024

An engagement session was conducted with the Sweden Embassy in Kuala Lumpur, Malaysia, to explore Sweden's policies and industries for a benchmarking mission aimed at developing a Talent Roadmap to enhance productivity from 2030 to 2034 with Malaysian Productivity Corporation (MPC). Numerous fascinating aspects of Sweden's policy development were uncovered, including its high rate of female labor force participation, productive workforce, and provision of high wages. To ensure a successful and productive benchmarking mission in Sweden, we are awaiting the Embassy's suggestions for industries to visit and their review of the itinerary.

In early phases of essential economic development, developing nations frequently have poor productivity but with great g...
14/05/2024

In early phases of essential economic development, developing nations frequently have poor productivity but with great growth potential. They have difficulties with institutional efficiency, technology adoption, and sustainable growth as they become middle-income nations. In planning and development, social and cultural shifts are frequently disregarded.

National policies often overlook social and cultural changes that promote economic growth and welfare. These changes, including shifts in societal norms, values, beliefs, behavior, and institutions, can influence economic growth and welfare. The modern workplace is undergoing significant transformations due to the interplay of generational cohorts and their distinct cultural backgrounds.

Additionally, generation Z (gen-Z) values authenticity, diversity, and social impact in the workplace. They are entrepreneurial, adaptable, and skilled in leveraging technology for productivity.

As a result, structural and social gaps exist in the economy, leading to youth unemployment and increased informal workers. Also, Malaysia's transition to a developed, progressive, and virtuous country will be hindered by social parameters that lack reform efforts and structural changes.

What are your thoughts? Do you work somewhere that has these kinds of social gaps?



To read more about this topic, click the link below:
https://www.nst.com.my/opinion/columnists/2024/04/1042060/better-reform-bridge-gap-between-structural-and-social-changes

14/05/2024

United Nations Children’s Fund (UNICEF), Malaysia telah mengeluarkan laporan Ranjau Sepanjang Jalan yang menelurusi impak kos sara hidup pasca pandemik terhadap isi rumah berpendapatan rendah di Kuala Lumpur. Ahli Ekonomi Utama Pusat Kajian Pasaran Buruh Masa Hadapan (EU-ERA), THE FUTURE telah diberi peluang untuk memberikan cadangan mekanisme pelaksanaan dasar yang telah dicadangkan di dalam dapatan laporan tersebut dalam sesi AGENDA AWANI di Astro AWANI.

Ranjau Sepanjang Jalan merupakan kesinambungan daripada projek Keluarga di Pinggiran dengan merungkai pertalian yang rumit antara peningkatan kos sara hidup dan kesannya ke atas wanita, kanak-kanak serta orang kurang upaya. Antara intipati cadangan kajian ini adalah memberikan gaji dan upah yang adil bagi mengimbangi impak peningkatan kos sara hidup. Dalam usaha untuk memberikan gaji dan upah yang adil, Ahli Ekonomi Utama kami mencadangkan perlunya mekanisme yang lebih holistik melibatkan kesemua pihak dengan menyediakan peluang reskilling and upskilling bagi pekerja, mentransformasikan industri kearah penggunaan teknologi bagi majikan juga Kerajaan dapat menyediakan inisiatif yang dapat melancarkan agenda peningkatan gaji ini.

Video penuh: https://www.youtube.com/live/xZyFLlkQpJM?si=NzTbz__fpVsdlnoi

06/05/2024

Climate change is happening all over the world and Malaysia is no exception. Malaysia is experiencing the harsh reality of climate change, with temperatures rising to 37 to 40 degrees Celsius in some regions (Jabatan Meteorologi Malaysia, 2024). Does this worsen climate change affect the economy?

Climate change can cause inflation, particularly in food prices. This is especially true based on a recent study in Germany which revealed that higher temperatures contribute to the continued rise in food prices (Kotz et al., 2024). This finding is further supported by the case in India, halting wheat exports due to crop failure caused by climate change, raising global food security concerns in 2022 (Singh, 2022).

In Malaysia, climate change could disrupt agriculture, causing domestic crop failure and increasing production costs, which in turn leads to food price inflation. Compounding the issue, Malaysia's reliance on imported agricultural goods further exacerbates the situation, as price hikes in global markets lead to imported inflation.
What action should the government take to deal with inflation due to climate change?

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