7 Ways You Can Help The Local Economy After This Pandemic
by Rachel Yeoh |
“WE HAVE BECOME POORER, LIVE WITH IT” - The Star headline, 27 April 2020
How’s that for encouragement?
It was all fun and memes during MCO, but now that we are moving towards recovery, some of us may have lost our sense of direction, others may be fearful, and almost all of us are affected by the plummeting economy.
If you have lost your job, received a pay cut, or are suffering from business losses, my heart goes out to you. It is a difficult time and no amount of forced positivity is going to make things better. However, it’s not the time for us to wallow in self-pity (although it is tempting); it is time to take action!
Instead of just thinking positively, let’s think realistically too, as it will be beneficial to ourselves and our community. It is time for us to ‘berganding bahu’ and ‘berganding minda’ to rebuild our economy together. After all, we’ve been using the hashtag #kitajagakita for the past weeks, right? If we think about getting ahead on our own, we only can go so far.
Before we go further, let’s break it down to bite sizes.
What is the economy?
The economy is a large system of production and consumption activities. It is how we make the things we want and decide who gets what with the limited resources.
Here’s an analogy: The economy acts as a body for a community. It consists of many parts, and each part plays an important role to keep the economy moving, like the organs of our body. Made up of an interrelated system of individuals, households, communities, businesses, services, and the government, it is connected by a lifeline (like blood in our body). That lifeline is money.
We now know a little bit of what the economy is and how we all play a part in it; let’s look at how we can be a POSITIVE CONTRIBUTOR to our economy.
1. Save Yourself
Just like a soldier going out for war, you gotta be prepared. You must have the correct mindset, equipped with the correct weapons, and be trained to use them. If you are a casualty, you ain’t helping yourself or anyone.
To save yourself, you need to be financially literate. You need to be endowed with the knowledge of how to get money, save money, and use money.
Being smart with money isn’t being stingy. It isn’t hoarding riches like Mr Scrooge. On the other end of the spectrum, spending on things you don’t need because you have money isn’t exactly ‘helping the economy’ either.
Guilty? So am I.
Here’s a simple checklist on how to save yourself during these trying times:
Build an emergency fund - about RM1,000 or more that you don’t touch unless there is an emergency.
Pay off your debts - money can be used in a better way than to be funnelled towards interest payment.
Get (at least) basic insurance - because we don’t know what will happen tomorrow.
Draw up a budget - so you know where your money goes and you can manage it better.
Talk, ask, and read about money - because there is always something new to learn.
Long-term investments - money does not grow on trees but compound interest is close enough.
On a flight, when the oxygen mask falls, we are always asked to help ourselves first before assisting others. The same theory is applied here. You need enough for yourself to have enough to contribute to the economy.
2. Be valuable
The formula to grow an economy is to have the ability to produce stuff with the resources we have. The COVID-19 pandemic has grounded the economy to a halt is because everyone is supposed to stay at home. At a standstill, nothing is running, and if nothing is running, the economy spirals downwards.
Now, we've got to be the hands, feet, and brains to crank up the economic machine again. The faster we recover from the halt, the faster the economy will blossom.
So let’s look at our resources:
People - We drive the economy by being part of a productive workforce, offering tangible contributions to local organisations and their activities, managing skills and structures, and more! You are building the economy just by working and offering your skills.
Materials - We give value to materials. When we use it, we give it purpose. Materials include natural resources, machinery, buildings, and technology. By being creative and resourceful with materials, we add value to the economy. Think of one item at home that has potential, but is just sitting around, collecting dust, and being useless. Designate it with a purpose and it could just help you and the economy.
As individuals, we can increase our value by learning new skills. There are many free online classes out there that you don’t have to pay a buck for. You can choose a course that will improve your cognitive, technical, or socio-emotional skills.
One example could be learning Korean (no, not so you can sing K-pop tunes) if you have a deep interest in it. You may have a full-time job during the day but with your skill in the Korean language, you could earn extra pocket money through basic translation work. When you get translation gigs, you earn money to invest it in the economy by purchasing and travelling local (which we will get to below).
When we can create wealth for ourselves, we have the power to use our money to better the economic and social fortunes of people and communities. Everyone wins!
3. Innovate and hire
The way forward is through innovation. The lifestyle we have today is contributed by innovation. You can be the one that sparks innovation!
We are all gifted in different expertise. Some people are organisers, some people are creative balls of fire, and some people can bring things to life through the work of their hands. If you have an amazing idea that will fuel the community around you, go through with it. If you have an entrepreneurial spirit and would like to start your venture, go for it. You can start small, and once there are demands and your business grows, start hiring part-timers or full-timers.
If that didn’t convince you, maybe you’d be wow-ed by the fact that Ali Baba flourished during the SARS pandemic of 2002-2004. Our good friend, Jack Ma (#tumpangglamour #asiadoneclaim) was navigating his then-small e-commerce company. However, because of underlying anxiety around travelling and human contact, his business boomed. The origins of Airbnb and Uber transpired during the 2008 financial crises - look how big it is today!
Did you have a ‘eureka’ moment during these trying times? If you did, put it to work and see what blooms during this time of adversity.
4. Travel within Malaysia
Are you itching to travel? If you are, try your best not to travel outside Malaysia. COVID-19 aside, traveling locally does not cost so much and the money you spend goes back to the community. We know that the tourism sector is the worst affected industry due to the pandemic and several long-standing hotels are forced to close down.
You can help the local economy by channeling your money to local tourism initiatives. I mean, Malaysia is a gorgeous country. We’ve got beautiful hills and mountains, breathtaking beaches, historical monuments, delicious food, and architectural wonders.
When traveling within the country, make it a point to dine in local eateries and taste the specialities. Did you know that almost every state in Malaysia has its version of laksa? If you didn’t, I would encourage you to find out. When travelling locally, choose to engage a local guide and buy locally-made souvenirs. They might be a little pricier than the generic ones, but hey, it helps small to medium enterprises.
Let’s crunch on some numbers.
According to the Department of Statistics Malaysia’s Domestic Tourism Survey 2018, domestic travel including excursionists and tourists contributed RM92.56 billion (move the decimal point nine steps behind to get a better grasp of the number) through domestic tourism expenditure in 2018. The average expenditure per trip was RM306.
Imagine, if we quit travelling overseas and focused on Cuti-Cuti Malaysia, we will be able to contribute billions back into our economy and keep close to 3.5 million people employed.
5. Buy local products
Similar to travelling locally, choosing to buy locally produced products help the local economy.
Err, how leh?
When you buy local, you create a demand for locally produced items. Money then flows within the community. When it keeps being passed from one local business to another local business, it keeps the local economy going.
Economists call this the ‘local multiplier effect’.
Imagine having RM100 to spend and you spend it all on local products. This money is then re-spent by others on local products. Let’s say this repeats five times. The recirculating money benefits the community by RM100 multiplied by five times!
HOWEVER, if your RM100 is used to buy imported goods, every sen goes out from the local community and the worth of that RM100 does not have a ‘multiplier effect’.
6. Take a pay cut
Pay cuts are a sensitive issue - and rightly so. Nobody wants to live on less than they are used to living, but then again, we are living in unprecedented times. If you are presented with a pay cut, first and foremost, check that it is legitimate. If your company has not announced a pay cut, they cannot cut your pay. However, if you sense that a pay cut might be knocking on your office desk, you could take your chances and act first.
No, I don’t mean leave the company.
Though, you could strike up a chat with your boss. Give ideas to your employer on how to cut back spending for your department instead of cutting jobs or your salary. You could bring about a bargain; for example, cutting several perks your company offers instead of getting a pay cut. Try your luck, who knows, it might work!
To business owners or employers, here’s a question: If you had to lay people off and conduct a pay cut, would you willingly cut your pay too?
If it is possible, I would encourage you to do so. Taking this brave step of leadership by example will allow your subordinates to see your understanding and compassionate nature. Keeping as many people hired as possible will keep the general percentage of unemployment low.
During this time, it is crucial to think like a bee or ant colony. Having more people unemployed will cause a bigger crash in the economy.
One does not have to be rich to give. If you cooked a little extra, why don’t you pack it and pass it on to the guard working at your apartment grounds? When you head over to the curry puff store and do not have the correct change to give the uncle selling it, why not let him keep the change?
There is always something you and I can give to the community. If you are still studying and living off from your PTPTN, you could still volunteer or give free online lessons to children whose parents cannot afford tuition (at your terms, of course). There is no denying that what goes around, eventually comes around.
You see, the economy is not something that only involves the government, politicians, banks, and the “people on top”, it involves all of us. When we know our collective power to improve the economy, we can then function as the biggest drivers to steer the economy to where we want it to be. If we want to recover quickly, first, we have to gain a renewed mindset from me to us.
Though it may be true that we all have become poorer - I say don’t live with it, do SOMETHING about it!
You can learn more about the writer on Instagram.