Companies in Malaysia focus on employee support during COVID-19 - survey

KUALA LUMPUR – Companies in Malaysia are decreasing recruitment budget while prioritising employee engagement and support initiatives to cope with the impact of the COVID-19 pandemic, according to human resource consulting firm Mercer LLC.

In a recent statement, Mercer said 72% of companies surveyed under its latest Pulse Survey are likely to reduce spending on recruitment in 2020.

“37% said they will only hire for replacements this year, while another 43% are planning a hiring freeze. Only 4% are considering retrenchment.

“At the same time, some companies are also taking this opportunity to enhance employee support and engagement. 13% of those surveyed are enhancing work-life balance programmes to enable more flexible and adaptive work arrangements, while 11% plan to increase their budget for healthcare benefits. Another 6% plan to enhance their training and development initiatives,” Mercer said based on the survey which consisted of data collected between March 26 and April 10, 2020.

Mercer said the Pulse Survey provides an overview of how COVID-19 has impacted human resource budget allocation as well as salary and bonus implementation among companies in Malaysia.

The survey also looked at the impact of COVID-19 on salary increment and found that only 5% of companies in Malaysia have implemented a salary cut while 9% are considering the option. 23% of companies are also
considering a reduction in budget for salary increment, while 17% have already done so.

“201 companies across 12 industries have shared their coping strategies to COVID-19, which has now enabled us [to] collectively learn from each other. Anecdotal data support our position that the report findings have maintained relevance well into June,” the consulting firm said.

Mercer said currently hard-hit sectors are the non-financial services, manufacturing, retail and wholesale, consumer goods and life sciences sectors.

Companies in these hard-hit sectors have indicated the largest percentage point reduction in their salary increment budget, noted Mercer.

“Across industries, companies in hard-hit sectors have indicated the largest reduction in salary increment budget — non-financial services (from 5.1% to 3.3%), manufacturing (from 5.1% to 3.8%) as well as retail and wholesale (from 5% to 4%). This is followed by consumer goods (from 5% to 4.6%) and life sciences (from 5.3% to 5%),” it said.