RM1 bil in productivity lost with every public holiday

(FMT) – Each public holiday in Malaysia costs the nation nearly RM1 billion in productivity, according to Malaysian Employers Federation executive director Shamsuddin Bardan.

He told FMT he based the estimate on his knowledge that the private sector pays out RM27 billion in wages every month.

He said productivity loss was especially severe during holidays that result in long weekends.

This month, there were three long weekends due to replacement public holidays for Awal Muharram, Malaysia Day and the Yang di-Pertuan Agong’s birthday.

Shamsuddin said the school term breaks, numbering four a year, were also disruptive since some parents would take leave from work to take their children on holidays.

“We should shift to a system which allows employees and employers to plan for holidays better,” he said. “Instead of having so many school breaks, we should have one long holiday period. It would minimise disruptions.”

Referring to holidays falling on weekends, he noted that there is no law requiring their immediate replacement, which would result in long weekends.

He said it would be better to add replacement holidays to annual leave entitlements.

“Employers can then better plan their resources to minimise disruptions,” he added.

Federation of Malaysian Manufacturers president Soh Thian Lai said 17 national public holidays a year were “too many” and could discourage foreign companies from investing in Malaysia.

He acknowledged that some holidays, particularly those tied to religious celebrations, could not be moved but said others could be incorporated with weekends to reduce the number of paid holidays, as practised in some countries.

He called for caution in declaring unplanned holidays in conjunction with victory celebrations.

“Declarations of ad hoc public holidays can prove detrimental to industries,” he said. “They affect productivity and efficiency.”

Economist Barjoyai Bardai of Universiti Tun Abdul Razak called for increases in productivity in both the private and public sectors in the face of competition from neighbouring countries for foreign investments.

He noted efforts by Thailand and Vietnam to improve their infrastructures, talent pools and productivity.

He said Putrajaya’s reform efforts could lead to a shrinking of the civil service and the emergence of more privatised services.

While this should be welcomed, he added, the downside was that the affected employees might not be ready for the change.

“In the private sector, if employees are not productive enough, business owners will find ways to boost productivity such as through automation,” he said. “This means loss of jobs.

“So employees need to step up their game, reskill and remain relevant to their employers.”