Rosnah Muhamad Ali; Rabiatul Adawiyah Rahim; Mohammad Faris Roslan; Nurul Syahirah Mohd Ali
Box Article 3: The Impact Of Full Closure Of Social And Economic Sector On Labour Demand: A Quick Survey
The COVID-19 pandemic had a major impact on economic sectors and subsequent
implications to the labour market in Malaysia. The economic crisis caused by the COVID-19
pandemic was the worst in Malaysia's history. In response to the outbreak of COVID-19, the
Movement Control Order (MCO) has been implemented to curb the spread of the virus and
flatten the curve of the infection. At the initial stage, this effort was successful with the number
of cases decreasing. However, by the end of the third quarter of 2020, the number of cases
began to increase.
In an effort to overcome the increasing new daily COVID-19 infection in the country, total
closure of the social and economic sectors (Total Lockdown) was implemented from
1 June 2021. In line with this, the National Security Council (MKN) had issued a list of permitted
and prohibited activities with details standard operating procedures (SOPs). Only 17 essential
services sectors were allowed to operate during this period.
With the closure of the economy had resulted in many businesses being closed temporarily.
The crisis has caused adverse impacts on the labour market demand in the private sector
especially the Small and Medium Enterprises (SMEs). A stricter MCO that only allows selected
essential businesses to run could also affect the labour market which already has a high number of joblessness. Apart from unemployment, movement restrictions have also adversely
affected labour productivity.