Malaysia’s 2021 budget includes increased funding and revised eligibility criteria for the wage subsidy program that took effect on 1 July 2020. “PenjananKerjaya 2.0” also features expanded hiring incentives for certain categories of workers. Funding for training programs devised in collaboration with private sector employers was also announced.  

Highlights

• The amount of funding for the wage subsidy program increased to MYR 2 billion. Companies in the tourism and retail sectors with up to 500 employees will be eligible for the program (eligibility was previously capped at 200 employees).
• The wage subsidy for employers hiring employees who earn MYR 1,500 has increased to 40% of the monthly salary — previously it was a flat rate of MYR 800.
• Employers hiring a person with disabilities, individuals who are unemployed on a long-term basis, single mothers, and retrenched workers will receive 20% of the employee’s monthly salary.
• Employers hiring a local person to replace a foreign worker will receive an additional 20% incentive calculated on the employee’s monthly wage.
• The maximum training rate that employers can claim for highly skilled training and professional certification increased to MYR 7,000 — up from MYR 4,000.
• Employers will receive an incentive of MYR 1,000 for hiring apprentices for a three-month period, and will be awarded a training grant of up to MYR 4,000 for participants in the Apprenticeship Programme for Graduates. 
• Upskilling and Reskilling Programmes implemented with private sector employers will be funded up to MYR 100 million. Employers in the tourism sector will have a six-month exemption from paying the Human Resources and Development Fund levy, starting in January 2020. 

Related resources

Non-Mercer resource

• Budget 2021 (Government of Malaysia, 6 Nov 2020)

Mercer resource

• Malaysia implements hiring incentive program for employers (3 Sep 2020)