Hotels In Malaysia: Cut Back Or Face Closure

Business recovery post COVID-19 looks to be an uphill climb for Malaysia’s hotel industry with occupancy rates averaging at 20% and 63% of hotel staff currently on unpaid leave. (L-R: Hotel Equatorial Penang, Hotel Istana Kuala Lumpur)

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As Malaysia’s lockdown extends indefinitely, hotels continue to shut down. The hospitality industry (that includes tour agencies, restaurants, bars, and hotels) are badly affected as businesses are forced to close either temporarily or permanently. Instability and the inability to generate income and provide salaries to employees have caused them to make such decisions. 


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A post shared by Hotel Istana Kuala Lumpur (@istanakl)

Currently, about 70% of Malaysia’s hotels are still operational with average occupancy rates not exceeding 20%. This has left some hoteliers with not much choice but to reduce workers’ benefits, salaries, and even their workforce. This leaves 63% of Malaysia’s hotel workers on unpaid leave, with 120 hotels either permanently or temporarily shut. This includes many renowned hotels, such as the famous Hotel Istana Kuala Lumpur (effective early September). 

Meanwhile, institutions like the 5-star Hotel Equatorial that operated in Penang for half a century shut down earlier this year. Malaysia’s Budget Hotel Association has also come out saying that hundreds of Penang’s budget hotels may face the same fate if Malaysia’s COVID-19 woes extend past the end of the year. 

In Melaka, many hotel staff have taken up jobs in unrelated fields to stay afloat amidst this crisis. This has resulted in calls by the Melaka chapter of a hotel group for the government to prioritise COVID-19 vaccinations for hotel staff.

For what it’s worth, the hospitality sector is keeping its hopes up. Everyone is keeping all fingers and toes crossed that with all the recovery strategies and sacrifices made thus far, our collective efforts will be paid off in 2022. 

Leia is neither a princess nor a fan of Star Wars (which she hopes isn’t a deal breaker). Besides her consuming passion for writing and travelling, humanitarian works have always interested her. Standing true to her life motto “To give is to receive”, Leia believes true happiness is gained when it is shared. She dreams to retire in a cottage at the foothills of the Swiss mountains with her mother and become a florist.