Malaysia’s goal is to reduce foreign workers

Manufacturers and plantation industry state they still need low-skilled foreigners

Malaysia is trying to get over its dependence on low-skilled foreign workers as it tries to move up the economic ladder. But that is hurting some important industries in the country.

The country targets to decrease the number of overseas workers by more than 130,000 in five years while getting companies to employ more high-skilled Malaysians and turn to automation to become a more advanced economy. Local businesses say they are doing so, but still, require low-skilled foreigners to fill jobs harvesting palm fruits and doing laundry.

Minor and medium enterprises — which made up 38% of gross domestic product last year — along with producers and plantations say they are facing labor scarcities that could threaten their growth. The biggest problem for SMEs is employing enough workers to meet immediate sales orders, rendering to the Federation of Malaysian Manufacturers. Labor scarcity is also among the main challenges for the plantation industry, IOI Corp stated.

While Prime Minister Mahathir Mohamad has given up his aim of turning Malaysia into a high-income country by next year, he is still urging the economy to rely more on high-tech industries and lesson resources. Limiting low-skilled foreign workers, who officially account for 15% of the labor force — the real number may be much greater — is one part of that move.

Malaysia is not alone in its struggle to navigate immigration policy to benefit the economy. Singapore is opening the spigots slightly for higher-skilled foreign workers.