KUALA LUMPUR – Despite regulatory loopholes and weak safety nets, the gig economy is expected to be a major contributor to national coffers, according to a report by the Finance Ministry.
The Malaysian Economic Outlook 2021 found that as the gig economy would command a substantial share of the workforce, higher learning institutions would need to prepare their graduates for such on-demand work.
Of the 1.3 million employed in the informal sector, 50.2% belonged to the 25 to 44 age group, reflecting that millennials are opting out of traditional work, the ministry found based on a survey.
Further, 54% of respondents indicated that gig jobs were their primary source of income.
Today’s youth, the ministry said, prefer the independence and flexibility provided by the gig economy over the fixed and monotonous nature of traditional jobs.
“With the increasing number of graduates joining the gig economy, IHLS should move away from educating and preparing students for full-time employment.
“This traditional method does a disservice to graduates, who will be ill-equipped and unprepared to succeed as independent workers in the gig economy.”
To better prepare students for such jobs, the ministry said, higher learning institutions should teach the basic skills required to work independently, expand career services to offer gig jobs and promote online courses.
But these developments, the ministry said, should also factor in the problems faced by gig workers, especially the need for steady jobs coupled with regular pay and benefits.
Additionally, these workers lack social security protection as they are not formally recognised as employees, therefore, they are not legally covered under labour provisions, the ministry added.
Some of the perks not accorded to on-demand workers include Employees Provident Fund savings, minimum wage, limit on working hours, paid annual and sick leave, as well as protection against unfair dismissal.
The ministry cited a 2019 survey by think-tank The Centre that found nearly 60% of more than 400 e-hailing and delivery contractors lacked emergency savings, while 59% lacked retirement funds.
Also, as there are no specific regulations to govern the gig economy, Putrajaya is considering new laws to govern the sector and protect workers’ welfare, the ministry said. – The Vibes, November 9, 2020
