Many fishermen make their living catching prawns and cockles in a small village in Kuala Sepetang. As they age, the workers do not have enough social security at work. — Agencies
PETALING JAYA: The social safety net for workers in the informal sector, especially senior citizens, needs to be bolstered amidst the rising cost of living and inadequate savings, say various groups, including an international body.
The World Bank's "Informal Employment in Malaysia" report released on Feb 26 outlined several recommendations for improvement, including a targeted subsidy for social insurance contributions, automatic voluntary deductions from earnings, and a steady increase in earnings.
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National Council of Senior Citizens Organisations Malaysia (Nascom) echoed the World Bank's recommendations to bolster the security of elderly workers.
Its president Datuk Dr Soon Ting Kueh said a substantial improvement in self-employment fund contribution policies should be implemented to protect informal senior citizen workers.
"The salary rate can be increased to boost their contribution funds.
"That, or the government can subsidise their contributions for better savings. For each RM10 (contribution), the government can subsidise RM5, for example.
"We must remember that there are those who continue working despite their retirement age because of the cost of living and inadequate Employees Provident Fund (EPF) savings," he said.
The number of informal workers in Malaysia is quite considerable; in the same report, the World Bank stated there are 4.1 million or 26.8% of the workforce as of 2022.
The Statistics Department said there were 656,000 people aged between 55 and 64 involved in the informal sector in 2022.
Most are involved in agriculture, forestry and fishery at 90.4% and classified as medium-skilled workers.
Institute for Democracy and Economic Affairs senior fellow Carmelo Ferlito said there were several reasons why more senior citizens are involved in the informal sector.
He said they may need help in looking for new jobs after leaving the formal work sector and instead found opportunities in informal employment.
"Informal jobs may become an opportunity to integrate a low pension," he added.
The World Bank also recommended a convening body, consisting of key stakeholders, on informal employment be formed and meet for regular consultations and policy calibration.
"(The members should) include representatives from the industry, workers, gig economy platforms, and civil society across sectors.
"(The) balance between under- and over-regulation, (which) both have risks, can be minimised with stakeholder engagement," it said.
Other recommendations include the enactment of policies to promote greater labour force participation among women and improved skills training before and during work.
"(There is a need to) ensure strong foundational skills, including digital skills (and) emerging technologies.
"Let's increase awareness and uptake of the Accreditation of Prior Experiential Learning (Apel) and Recognition of Prior Learning (RPL) initiatives through Socso (Social Welfare Organisation) centres and case workers, among others," the World Bank said.
