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MALAYSIA is trying to reduce its dependency on low-skilled foreign workers as it moves up the economic value chain.
To reduce the number of foreign low-skilled workers, both the businesses and industries across all the economic sectors are asked to hire more locals and embrace automation with the aim of becoming a high-income nation.
And interestingly they have been doing so, where local employees have become the first choice.
Still, businesses and industries across all the economic sectors need low-skilled foreigners to fill up the many jobs available where the locals are reluctant to take on.
Most of the jobs taken up by the foreign workers are low entry levels considered to be dirty, dangerous, and difficult or 3D – reasons as to why the locals shy away.
Also, the locals are seeking a more balanced lifestyle, better paying jobs like work in the gig economy or going abroad for the same low entry level jobs.
Today, the labour shortage issues have worsened, now estimated foreign workers at 1.17 million in 2021 (registered workers) after the country froze the hiring of foreign workers in the past two years to stem the spread of Covid-19, down from close to two million before the pandemic.
It has created an acute labour shortage and certainly weighed on businesses and industries operating capacity as well as operating costs that lead to loss of billions of dollars in revenue to the economy from the border opening, the move to endemic from the pandemic and the government’s requirement on the need to establish that the locals refuse the jobs first before allowing for the foreign workers which is tough.
This has caught businesses and industries across all the economic sectors in “Catch 22” situation.
While trying to incentivise the locals to work, they are at the same time facing strong challenges to retain them due to the issue of 3D and are not keen to get themselves employed at “entry-level” jobs.
On the ground, employers are extremely frustrated for not being able to engage the necessary workers as locals still shun the work performed by foreign workers. It is not just about raising the salary, but it is more of the preferences of the locals.
It appears that no matter what kind of upskilling and reskilling is being introduced, the locals are less likely to do the low entry levels of work. This explains why our youth (15 to 24 years old) unemployment rate is high at 11.1% at the end March 2022.
With the chronic shortage of foreign workers prolonging, a new challenge has emerged.
It is the “pinching” of foreign workers, something that used to be common with locals at all levels of the organisation structure.