Petronas has confirmed that it will layoff employees to ensure long term survival.

The O&G giant announced last Friday that it currently has too many workers and needs to undertake a workforce restructuring.

“If we don’t do it now, there’ll be no Petronas in 10 years,” its CEO said.

Starting the second half of 2025, employees who are no longer needed will be retrenched rightsized. Petronas has promised that those affected will receive “appropriate assistance.”

According to its CEO, the company currently has 52,000 employees, but 16,000 are considered “Enablers,” which the group aims to reduce.

On Sunday, I conducted an X space with financial experts Hann Liew and Sani Hamid to discuss job security (centering around Petronas’ layoffs) and EPF’s projected dividends.

If you missed the session, listen to the full replay on Spotify and Apple Podcast. Scroll down for a QNA breakdown of the session.

Q1: Do you think jobs these days no longer provide security, where an employee can stay with the same company for 20-30 years without ever worrying about switching?

Hann: I’m tempted to say that most people these days wouldn’t want to stay in the same job for 20-30 years anyway. Maybe I shouldn’t say that.

But for companies that have been around for a long time, it’s likely some employees have stayed with them for many years. Still, job security depends on a few key factors:

i) The company itself must survive for 20-30 years. This requires long-term sustainability, and the reality is that many businesses don’t last more than 3-5 years.

ii) If a company has a long track record, its top performers—especially those in essential roles—are unlikely to be let go because they contribute significant value.

Ultimately, job security largely depends on the value you bring. High performers and those who directly contribute to revenue are typically the least likely to be retrenched.

Sani: I agree with Hann. I believe the idea of an 'iron rice bowl' no longer exists. In the private sector, where profit is the priority, job security is driven by your ability, productivity, and the value you bring to the company.

No one should feel completely safe.

Q2: What should I do if I know I might be retrenched? How can I better prepare for these uncertainties—both mentally and financially?

Hann: Cyclical companies, like Petronas and banks, often go through periods of being overstaffed or understaffed.

For example, in 2016, Petronas retrenched 1,000 workers when oil prices dropped to $28 per barrel—a 13-year low. This wasn’t due to poor employee performance but rather external, unpredictable factors. A more recent case involving Petronas-Petros also led to cost-cutting measures.

So, if you work in a cyclical industry (actually in any industry at all), it’s crucial to stay aware of downturns in your sector. This will help you mentally prepare for the possibility of being retrenched.

Sani: Build an emergency fund covering 3 to 6 months of your monthly salary. Knowing you have a safety net will give you peace of mind and allow you to focus on your work, rather than constantly worrying about layoffs.

I want to stress that building this rainy-day fund should be your top priority—especially if you’re just starting your career. It’s even more important than investing or insurance in the early stages. Having that buffer will protect you when uncertainties arise.

Q3: Apart from achieving good KPIs, are there other ways to reduce the risk of being “rightsized”?

Hann: Achieving strong KPIs is one of the best ways to secure your position in a company. Like what I covered earlier, job security largely depends on the value you contribute. High performers, especially those who directly help generate revenue, are usually the last to be retrenched.

However, beyond hitting your KPIs, being versatile and contributing in other areas can make you an even more valuable asset to the company. If you’re multi-skilled and can support the business in different ways outside your core role, you become harder to replace.

Sani: Don’t just focus on doing your job well and hoping for a pay raise. Go the extra mile—take courses, upskill yourself, and learn beyond your current responsibilities. Improving both your core expertise and your overall adaptability can strengthen your position in the company.

TRANSITION TO EPF

According to analysts, EPF dividends for 2024 are expected to exceed 5.80%, possibly even higher.

If this is realized, it will be the highest payout in the past three years. Dividends are typically backdated and announced in March, so we can expect EPF’s 2024 rates to be revealed early next month.

Q1: Hann, you previously shared a thread with some calculations—do you still believe 5.80% is achievable?

Hann: Yes, in my earlier thread, I estimated that EPF dividends would likely range between 5.80% to 6.10%.

The fund recorded an income of RM57.57 billion in the first nine months of 2024. If this trend holds and we annualize the income, a payout in that range is still very much possible.

It would certainly be a morale booster if EPF manages to deliver 6.00%.

Q2: Any tips for people to increase their retirement savings?

Hann: If you’re young (20-30 years from retirement), don’t rely solely on EPF. Look for other investment opportunities to grow your wealth and maximize returns.

If you’re older and closer to retirement, EPF becomes more liquid and accessible. You should focus on maximizing your contributions:

• For unemployed/self-employed individuals: EPF offers a 20% bonus on voluntary contributions (capped at RM500 annually) under the i-Saraan scheme.

• For employed individuals: You can voluntarily contribute up to RM100,000 per year to your EPF. Plus, you get tax reliefs for both mandatory and voluntary contributions (up to RM7,000 annually).

Sani: If you have extra cash, top up your CPF or EPF whenever possible. It may not seem like much now, but over time, it adds up and can make a big difference.

You can invest your savings too, but remember that investing comes with risk. If you don’t have the knowledge or experience, you could lose more money than you gain—whereas EPF provides steady and guaranteed returns.

I’m approaching 55 soon, and I don’t check my CPF account often. But every time I do, I’m still surprised to see it has grown to hundreds of thousands. If I had to save that much on my own every month, I’m not sure I’d have the discipline to consistently put aside that amount.

Listen to the full replay on:

Hann Liew is a personal finance expert with over a decade of experience in the financial industry. Previously the CEO of RinggitPlus, he is a licensed financial planner (CFP) and a chartered financial analyst (CFA), and has helped tens of thousands of Malaysians on their path toward financial literacy. Hann is currently the founder of Halogen Capital, the world's first Shariah-compliant crypto fund manager that provides institutional exposure to Bitcoin and other cryptocurrencies.

Mr. Sani Hamid is an economist and certified financial planner (CFA). He’s a frequent commentator in the media and has over 30 years of experience in the financial markets, having worked for companies such as S&P Ratings as a Director in the sovereign team overseeing the ratings of countries such as Indonesia, India, Malaysia, and Singapore.

⚠️ Disclaimer: Financial planning is a complex process and these two speakers can only offer their general opinions. If you want more detailed planning and advice, you can DM both of these speakers personally (priority is given to patrons of The Futurizts).

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