Proposal for 100% foreign workers may add 600k migrants

The hiring leeway is expected to resolve some pressing bottleneck issues on the production side, according to MEF


Total hiring of foreign workers by export-oriented companies could see nearly 600,000 additional foreign workers being employed in the country.

On Tuesday, Deputy Home Minister Datuk Nur Jazlan Mohamed said the government is considering a scheme to allow these companies to hire 100% of foreign workers to bulk up their production lines.

As the majority of export-oriented companies struggle to cope with labour shortages as demands grow, the total number of foreign workers in the country could reach a new high of 2.4 million from the current 1.7 million — should the scheme be implemented.

Malaysian Employers Federation (MEF) ED Datuk Shamsuddin Bardan said the hiring leeway is expected to resolve some pressing bottleneck issues on the production side, as attempts to attract local labour have been futile.

“Currently, they have manpower problems and they cannot attract locals to do the job. Even if they do, locals do not stay for too long. If it happens, the policy will allow companies to meet their human resources need. They require a consistent supply of labour,” Shamsuddin told The Malaysian Reserve when contacted recently.

He said although a short-term solution is needed to address the current labour inadequacy, both employers and the government should not be complacent and rely too heavily on foreign workers in the long term.

“We cannot expect locals to be there at the moment. But even then, there should be a way to relook at putting locals back into the production line.

To rely on foreign labour alone is not viable in the long term,” Shamsuddin said.

The issue of over dependence on foreign labour has prompted the government to adopt stricter guidelines to reduce the number of foreign workers in the country.

However, business organisations remain adamant on the need for greater labour to meet growing demands in a competitive global market.

Federation of Malaysian Manufacturers Selangor branch chairman Datuk Soh Thian Lai said consistency of labour supply is paramount to businesses, especially exporters who are positioned to capitalise on higher volume as the ringgit continues to weaken.

“With the 100% foreign worker policy, export-oriented companies can push up their output and further increase their export value without any interruption or stopping of production lines,” he said.

Given the current situation, Soh said between 20% and 30% of the group’s estimated 3,000 members could go for extra recruitment of foreign workers.

Meanwhile, SME Association of Malaysia president Michael Kang Hua Keong said there is a need to extend the scheme to small and medium enterprises (SMEs).

He said while only 18.6% of SMEs are involved in exports, others play an indirect role by offering support to multinational companies (MNCs).

“About a third of our 30,000 members are involved directly and indirectly in exports, and 90% of them are facing labour shortages.

“Each company is easily short of 10,000 to 20,000 workers,” Kang said, adding that SMEs are restricted from hiring any foreign labour at present.

In 2016, SME contribution to gross domestic product grew by only 0.3% due to the shortage of labour.

“The government should look to consider SMEs in the policy, especially those who are working for MNCs.

“We should be allowed to bring in foreign workers because SMEs do not have enough workforce to meet the demand,” Kang said.