PETALING JAYA: The continued depreciation of the ringgit against the US dollar and other major currencies has cast the spotlight on the Malaysian economy.
Malaysians now have to pay more for imports, while exporters are keeping their stash of US dollars in hopes that it will continue to appreciate in value.
This will inevitably raise the demand for the greenback and therefore put greater pressure on the local note.
But there is another side to the story, the one that is often overlooked. It is the impact it has on the personal life of the average person.
Industrial psychologist Victor Goh believes the depreciating value of the ringgit has already had a significant impact on work-life balance.
Meanwhile, Malaysian Employers Federation (MEF) president Syed Hussain Syed Husman told FMT Business that people would have to make adjustments now to ensure their own mental well-being.
The ringgit has been on a downtrend over the past few years, but its decline has been most significant this year.
It has fallen from about RM4 to the dollar in early 2018 to RM4.68 at yesterday’s close. In January this year, it was trading at about RM4.40 to the dollar.
Against the British pound, it has fallen from about RM5.27 in January to RM5.72 at yesterday’s close.
Goh, who is with HELP University, said the depreciation of the ringgit would make Malaysian goods cheaper and thus more attractive, leading to higher demand.
“This presents new business opportunities for Malaysian companies. As a result, employees are expected to exert greater efforts to boost production,” he told FMT Business.
“As the workload piles up, the company will have to expand the workforce, but it will also try to squeeze more out of every employee to ensure output keeps pace with rising demand,” he said.
Goh said a weaker ringgit could also lead to rising prices, putting additional pressure on workers to earn more to sustain themselves.
“Financial instability is not just an economic phenomenon. It is a psychological one as well,” he said. “These things affect work-life balance.”
He said that if such conditions persisted, it could also affect one’s ability to plan ahead, putting further strain on work-life balance.
To illustrate his point, Goh said parents who have sent their children for studies abroad would now have to work harder to cover the increased cost, while others may have to leave their families behind to work overseas where they can make more money.
“Such conditions have a detrimental effect on the daily lives of these individuals and those around them,” he added.
Adjusting lifestyles and spending habits
Syed Hussain does not see Malaysia declining into financial instability as a result of the depreciation of the ringgit.
Even so, he said, people must begin to adjust to a new lifestyle and spending pattern to ensure their physical and mental well-being is not severely affected.
“We all have to strive for work-life balance. There is no one-size-fits-all approach,” he pointed out.
“What is important is that we all work to enhance our productivity and show the desired results. This applies to both employers and employees,” he said.
“Success is not only in the hours of work put in but also in the creativity and passion of the workforce and employers to get better,” he added.