Budget 2022: A stepping stone for job seekers as Putrajaya looks to address unemployment through reskilling and upskilling

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A whopping RM2.5 billion has been set aside for this flagship initiative involving seven different demographics of job seekers, with varying levels of subsidies, and is expected to place at least 600,000 with jobs next year. — Picture by Choo Choy May
A whopping RM2.5 billion has been set aside for this flagship initiative involving seven different demographics of job seekers, with varying levels of subsidies, and is expected to place at least 600,000 with jobs next year. — Picture by Choo Choy May

KUALA LUMPUR, Nov 26 — As unemployment numbers rose globally as a consequence of Covid-19, the government doubled down on re-employment efforts and allocated RM4.8 billion to ensure some 600,000 jobs are created to restore livelihoods under Budget 2022.

This RM4.8 billion will cover initiatives ranging from wage subsidies to incentivise companies to take on new employees as well as reskilling and upskilling modules, and tax reliefs.

These efforts are broken down into three main thrusts namely the Jamin Kerja employment incentive, the Malaysia Short-Term Employment Programme (MySTEP), and various upskilling and reskilling programs.

Jamin Kerja employment incentive

A whopping RM2.5 billion has been set aside for this flagship initiative, involving seven different demographics of job seekers, with varying levels of subsidies, and is expected to place at least 600,000 with jobs next year.

Spearheaded by the Social Security Organisation (Socso), the vulnerable groups have been prioritised with up to 30 per cent of the employee’s first six months salaries subsidised by the initiative, and 40 per cent the next six months.

Those listed as within the vulnerable groups include:

  • Individuals or graduates who have been unemployed for over 180 days,

  • Army veterans,

  • Those from the Orang Asli community,

  • Former inmates or individuals under parole,

  • Disabled persons registered under the Social Welfare Department,

  • Employees aged 50 and above, and,

  • Participants of Socso’s Return to Work (RTW) programme.

Women were also not left behind, with identical 30 per cent and subsequent 40 per cent subsidies for their wages across 12 months.

These include women unemployed for over a year inclusive of a career break, single mothers or housewives, and extends to those accepting offers that include flexible working arrangements.

Salaries for employees in key sectors such as the information and communications technology sector, and tourism industry, will also be subsidised at the above rates.

The second tier sees Socso providing a 20 per cent subsidy for the first six months and 30 per cent the following six months for salaries that will be afforded to future employees that fall within two categories.

The first category covers individuals aged 16 to 50 who are not actively working.

The second category is for those hired by companies looking to replace foreign staff with new local talent. An additional 10 per cent of salary subsidies will be provided for wages of these individuals that meet the criteria.

For companies conducting apprenticeship programmes, incentives are also offered under the Jamin Kerja initiative in the form of a RM900 monthly allowance for six months provided by Socso, for apprentices who are school leavers and graduates aged 18 to 30, and extended to those hiring staff for executive roles who are qualified with at least a diploma.

Those taking on gig workers will also enjoy wage incentives, with a RM600 subsidy given for their wages for six months.

These apply to successful applicants who previously lost their jobs, those within the list of vulnerable groups as defined under the eKasih system, individuals who were previously forced to take unpaid leave, graduates who have been unemployed for at least a month, housewives, and those in the low-income groups.

The Jamin Kerja incentive is also set to provide an extra RM200 a month for gig-workers earning more than RM2,500, or for those who clock in more than 120 hours of work.

MySTEP

The second initiative is aimed at revitalising the job market through placements in government-linked companies (GLCs) and within the public sector.

A total of 80,000 employment opportunities are expected to be created through this programme, with 30,000 jobs set to be offered by GLCs and another 50,000 coming from the public sector.

Initiatives under MySTEP are said to be worth some RM1.8 billion.

Reskilling and upskilling

Included within Budget 2022 are allocations for training modules to ensure the workforce remains relevant and in tune with the latest methods.

A total of RM1.1 billion has been allocated for these training and upskilling programmes, with a total of 14 such programmes overseen by as many government agencies.

Under the programme, the Ministry of Higher Education alone is expecting to train some 65,000 individuals under two separate programmes, the KPT-CAP and KPT-PACE modules, while the Human Resources Capital Development Corporation (HRDCorp) expects to equip 36,000 individuals.

The Department of Polytechnic and Community College Education (JPPKK) expects to train at least 25,000 individuals through their Technical and Vocational Education and Training (TVET) programmes, while the Ministry of International Trade and Industry Reskilling programmes aim to train at least 24,000 individuals.

Regional Corridors are set to offer up to 16,000 training spots, the Skills Development Fund Corporation 13,000 training spots through its Perkasa TVET programme, while the Malaysian Digital Economy Corporation (MDEC) is set to train 12,000 trainees.

Other agencies included within the initiative include the Armed Forces Veterans Reskilling and Upskilling Programme (PRU-ATV) to take on 16,000 trainees, the Department of Skills Development (JPK) with 10,000 trainees for its SLDN Plus programme, and the Ministry of Science Technology and Innovation with 5,000 trainees through their Upskilling for Deeptech and Future Skills programme.

Some 5,000 trainees are expected to go under the Partnerships with State Governments programme conducted by the Federation of Skills Development Centre (FMSDC), 3,000 more under the Peneraju Skil and Peneraju Teknologi conducted by the Prime Minister’s Department, and 1,000 spots set to be offered under the Creative Graduates Incubator Programme initiated by MyCreative Ventures.

Tax and insurance

Budget 2022 also accommodates tax reliefs for those looking to level up their skills, with exemptions ranging from RM1,000 to RM2,000 for expenses incurred when attending reskilling and upskilling courses, claimable until 2023.

Those looking to attend private upskilling courses would also be given a RM7,000 tax relief for their course fees, as long as they are enrolled in an approved institution or body.

Also within Budget 2022 is an allocation for Socso’s coverage to extend into nine new categories, namely, artists, hawkers, fisheries, agriculture, the tourism sector, the disabled, those from the Orang Asli communities, and for Orang Asal Sabah Sarawak and Community Rehabilitation supervisors and staff.

Socso will also continue to provide allowances for those still job-hunting, with contributors given equivalent to 80 per cent of their wages on the first month, 50 per cent for the following five months, and 30 per cent for the eighth to the tenth month.

Non-Socso contributors can also apply to receive RM300 allowance for three months under this scheme which is expected to be worth RM300 million.

Other incentives include increasing the ceiling of insured salaries from RM4,000 to RM5,000 aimed at improving the social security of some nine million members under Socso, and a RM4,000 tax relief for Employee’s Provident Fund contributors depositing voluntarily.

Additionally, increased tax relief limits from RM250 to RM350 will be implemented while expanding the scope of relief for Socso contributors to include those depositing through the Employment Insurance System.


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