Businesses to lose 100% income if Covid-19 crisis persists, says MPC

Malaysia Productivity Corporation (MPC) has conducted a study on the impact of Covid-19 on productivity. Findings from the study affirm the current scenario that businesses have been severely affected by the pandemic, with the enforcement of the Movement Control Order (MCO) as the major disruptor from the crisis. More than 70 percent of the respondents were significantly affected by the pandemic especially in terms of revenue streams.

Should the situation persist longer, companies are facing the possibility of losing up to 100 percent of income which may lead to the closure of businesses. This may snowball to other negative impacts in the workforce namely increased unemployment rate, loss of assets, and accumulated debts.

The possible scenario will eventually lead to the declining productivity growth of the country. As of the time of data collection, more than 50 percent of the respondents have already experienced reduction of productivity level by 25 percent to 100 percent due to restrictions in the movements of goods and people when MCO was implemented from March 18.

More positive outlooks on working-from-home model, adoption of technology and digitalisation, and future recovery were gathered from the study. Nearly 50 percent of the respondents were receptive to remote working model. MCO has also compelled industries to leverage technology faster during the duration to ensure business sustainability and delivery. Data collected indicated that business recovery would take 6-month duration after the crisis ends.

On leveraging government assistance due to the crisis, the study’s finding indicated that 32 percent of the respondents lacked awareness and information on how to apply for the incentives.  On March 27, the Government announced a second Economic Stimulus Package (ESP2) themed Prihatin Rakyat. ESP2 is valued at RM250 billion to ease the burden of the rakyat and support Small and Medium Enterprises.

Director General of MPC, Abdul Latif Haji Abu Seman said, MPC has taken several steps to accelerate the economic recovery and assist the industry players to rebuild businesses.

“Among the notable initiatives taken and still ongoing are the industry capacity and capability building programme via webinars and online trainings, business virtual advisory services, and review of regulations to reduce unnecessary burdens in rebuilding businesses. Efforts are still ongoing to hasten and catalyse economic recovery and productivity growth as business activities begin to increase during the Conditional Movement Control Order (CMCO).

“For example, video competition and prize-giving ceremony on Productivity Linked Wage System (PLWS) with universities to pursue productivity culture. Productivity experts are also given the opportunities to conduct online training such as C Suite for leaders and share knowledge on ‘new norms’ to the employees of enterprises to prepare them for post-COVID 19.

“Since March 17 – April 28, 93 online programmes organized attended by a total of 14,104 participants, an average of 150 participants per programme,” he said.

He added, MPC with Technical Experts facilitates the SMEs’ business recovery process using e-Business Solutions to rebuild their morale and revive their businesses, taking MCO as the opportunity to enhance soft skills among the SMEs.

Among other types of online facilitation is the KOPI CHAT session, an online business consultancy on Cost-Effective I4.0 Solutions, Understanding new normal for SMEs, Module revision, and Pitching session.

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