Penang labour department reports have revealed that the states current retrenchment figures as up to the end of last year with15,321 workers laid-off, said state executive councillor Toh Kin Woon.

Toh said these figures were obtained from the reports submitted by companies undergoing retrenchment exercises.

The reports are mandatory but not all firms comply as the labour department is presently understaffed to monitor the problem, he told malaysiakini in an interview recently.

Toh said 90 percent of those affected are from the electronics sector which contributes 46 percent to the states GDP.

He said the manufacturing and services sector have also suffered due to the United States economic downturn in the last quarter of year 2000.

The US electronic sector softened even before the Sept 11 terrorist attacks, he said, adding as exports are not coming in, many electronic companies are forced to close down.

Not bright

Toh said signs of a recovery are not bright although the assumption is that this will occur when there is a return of confidence in the US market.

Malaysia, particularly Penang relies on the US as a major export market followed by Japan, Singapore and Europe, which are all experiencing a recession.

So far the interest rates in the US have been slashed six times down to 1.7 percent. To encourage short-term consumption spending President George W Bush announced major tax cuts.

But the US downturn dampened sentiments and it shows because the market is not really picking up; the receiving wealth effect is not there, he said.

Toh said with the overcapacity in the manufacturing sector, even if demand for electronic products pick up, Penang cannot compete in some areas.

As a result of not being able to compete and high operating costs, companies find it better to move to Thailand and China, he said.

Government prepared

Toh said the government is prepared to face any eventuality by encouraging more value-added products such as in the areas of research and development, engineering, logistics, sales and services.

He said Penang has also developed other areas such as education, health and tourism to enhance the economic standing of the state.

For those retrenched, Toh said the state, together with the human resources ministry, have offered skills training to graduates and non-graduates but the response was poor.

Only 500 responded to the graduate-level courses and 302 for the non-graduate ones, he lamented.

Asked if there are statistics to indicate whether retrenched workers have found other jobs, Toh claimed the labour department had its hands full and thus was unable to provide the figures.

Toh also said the National Economic Advisory Council is conducting a study on the different aspects of the labour market to plan appropriate responses.