Petronas may cut 1,000 jobs in Malaysia amid falling oil prices

Author: PM editorial | Date: 9 Mar 2016

Oil and gas giant’s redundancies contribute to gloomy job market outlook in Malaysia

Malaysia’s national oil firm Petroliam Nasional Berhad, which trades as Petronas, may make 1,000 of its employees redundant.
 
The organisation stated that it would undertake “exhaustive efforts” to redeploy the 1,000 roles over the next six months.
 
Petronas also said that its new structure is part of “deliberate, sequential measures” it is undertaking to navigate through tough trading conditions.
 
These are the first major decisions the organisation has had to make since oil prices plummeted in June 2014. The announcement was made following a statement last which, in which the organisation announced that its revenue had tumbled 25 per cent and its profit after tax plunging 56 per cent in 2015. Until 2014, around a third of government revenues came from Petronas.
 
This announcement is the latest in a string of high-profile redundancies in Malaysia. Last May, Malaysian Airlines was forced to cut 6,000 jobs – around 30 per cent of its 20,000-strong workforce – because of a drop in revenue after the MH17 air crash in eastern Ukraine on 17 July and the disappearance of flight MH370 in March 2014.
 
Over 20,000 employees from various sectors were made redundant between January and September 2015, research from the Malaysian Employers’ Federation (MEF) found.
 
Datuk Shamsuddin Bardan, executive director of the MEF, said the negative trend is set to spill over to 2016, with more Malaysian companies facing the prospect of retrenchment and possibly ceasing operations altogether.
 
“Even though the economy is expected to grow by 4.7 per cent, the outlook for most sectors is not very encouraging, and it has been very challenging,” Bardan told the Malaysian Insider.
 
“To be fair, 6,000 employees were retrenched as the result of Malaysia Airlines’ restructuring [process], and that contributed quite a huge percentage to the total retrenchment in 2015.
 
“By the end of 2015, we expected it to touch 25,000 (total retrenchments). This is expected to continue in 2016 because it is not seen as a positive year,” he said.