KUALA LUMPUR – Malaysia’s labour productivity continued to decline at -2.9% in the fourth quarter (Q4) of last year after registering -2.2% in Q3 2020, due to the impact of the conditional movement control order (CMCO), according to the Statistics Department.
Chief statistician Datuk Seri Mohd Uzir Mahidin said the total hours worked in Q4 2020 declined 2.7% in line with the shorter business operation hours following the CMCO, recording a total of 8.6 billion hours.
In a statement in conjunction with the release of the Q4 2020 Labour Productivity report today, the analyst highlighted that the pandemic had forced businesses to re-examine their existing business operation models to explore new opportunities through digitalisation.
“With the adoption of technology, it will improve efficiency in production and subsequently escalate the productivity in the medium- and long-term,” he said.
Uzir said labour productivity remained in a declining trend for the fourth consecutive quarter to record value added per employee of RM23,570 per person (Q3 2020: RM23,257 per person).
He said the amount of employment during the quarter dropped 0.6% to 15.2 million persons (Q3 2020: -0.4%), while gross domestic product for Q4 2020 contracted 3.4% (Q3 2020: -2.6%).
“Total hours worked in Q4 2020 declined 2.7% (Q3 2020:-2.7%), in line with the shorter business operation hours following the CMCO, recording a total hours worked of 8.6 billion hours.
“This had resulted in the labour productivity – as measured by value added per hour worked – dropping slightly by 0.8% at RM42 per hour after increasing marginally by 0.1% at RM41 per hour in Q3 2020,” he added.
The statement said that the manufacturing sector was the only sector that posted a positive growth of 3.2% in Q4 (Q3 2020: 3.7%) for labour productivity by value added per employment.
“Almost all economic sectors registered a decrease in labour productivity by value added per hour worked in this quarter, except for manufacturing which continued to post an increase of 6.0% (Q3 2020: 7.0%),” it said.
According to Uzir, labour productivity measured as value added per employee for 2020 dropped 5.4% as compared to 2.1% in 2019 as a consequence of the health crisis and the various phases of containment measures imposed throughout the whole year.
On the contrary, he said labour productivity measured by value added per hour worked went up by 3.4% in 2020 compared to 2.2% in 2019 with a value of RM42 per hour (2019: RM41 per hour).
“Total hours worked for the year 2020 amounted to 32.0 billion hours (2019: 35.0 billion hours), reduced 8.7% (2019: 2.1%).
“During the year, economic performance indicated by value added declined sharply by 5.6% (2019: 4.3%), while employment decreased 0.2% (2019: 2.1%),” he added. – Bernama, February 17, 2021
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