Malaysian employers facing labour shortage urge government to lift ban on foreign workers

Author: PM editorial | Date: 4 May 2016

Deputy prime minister promises decision soon – two months after freeze on immigration

Malaysian employers have urged the government to rethink its temporary ban on new foreign workers as they face a damaging labour shortage.
 
Two months after freezing the country’s intake of foreign workers, the deputy prime minister Datuk Seri Dr Ahmad Zahid Hamidi said a decision would be made soon on whether to lift the ban.
 
"I am very concerned about the issue of foreign workers, and I am aware that many sectors are affected. Employers are urging the government to open our doors to more foreign workers again,” he said. “The government understands the need of certain sectors for foreign workers. An important decision on this will be announced in due course.”
 
According to the Straits Times, the Malaysian furniture industry said their shipments are down more than 28 per cent because of a shortfall of 27,000 workers. The Federation of Malaysian Manufacturers said many of its members are unable to fulfil orders because of widespread manpower shortages.
 
Malaysia is dependent on foreign labour in its manufacturing and production sectors. The country has a population of just under 30 million, and the number of migrants from Indonesia is 1,051,000; from Bangladesh 352,000; and from Myanmar 248,000. In 2010, foreign workers made 15 per cent of the country’s labour force.
 
"Historically and traditionally many Asian countries have witnessed migration flows, both to other continents and to other Asian countries," said Professor Chris Rowley from Cass Business School at City University in the UK. "[This has happened in] Singapore, to help fuel its economic boom, and also in Malaysia, as it developed, with immigration from Indonesia and south-east Asia."
 
Research by the Migration Policy Institute suggests most intra-ASEAN migration is low-skilled and these jobs remain unattractive to nationals, despite the efforts of some countries to change this. In Malaysia, for example, a minimum wage was introduced, including for migrant workers, in the hope that migrant jobs would become more attractive to domestic workers.
 
On 18 February, Malaysia and Bangladesh signed a memorandum of understanding allowing 1.5 million Bangladeshi workers to enter Malaysia over the next three years. But the next day the Malaysian government suspended all recruitment of foreign workers, amid public fears that such a large influx would place too big a burden on the country’s infrastructure.