CLEAR POLICY NEEDED ON FOREIGN LABOUR
It will help to regulate and manage the inflow of foreign workers, and the standards to be observed by employers
MANAGING the issues of foreign workers will remain pertinent in many years to come, and it is especially so given our steady economic growth, the latest estimate being 5.9 per cent for 2017. The rate of 5 to 5.5 per cent for this year can be achievable given the many initiatives to stimulate domestic demand and the possible opportunities arising from such initiatives.
These sustained growth expectations may have strong implications on supply and demand for workers, what with the state and structure of the economy, which has strong presence of agriculture, plantations and construction — by their nature, are labour intensive. So are our export-oriented manufacturing activities.
Relying on foreign workers and foreign skills is practised in many countries too. Singapore, our neighbour, relies much on foreign workers, especially from Malaysia. So are the economies such as Hong Kong. Even developed countries tend to rely on foreign workers; the main difference is their reliance is more on professionals and highly trained and skilled workers.
This situation is in fact already applicable in Malaysia where economic and social transformation has to rely more on high skills and professions. It is good for the national economy to import, say, a hundred thousand professionals and highly skilled foreign workers than to import few millions of low skilled foreign workers the way we do now.
At the policy level, this issue of dependence on foreign workers has to be examined and reviewed often, at least once in three to four years to send the message to our industries of what the priorities and directions are, in the context of employing foreign labour. There is no way we can undertake major economic activities without relying on foreign labour any more.
A clear policy will also help the immigration department in regulating and managing the inflow of foreign workers, the standards to be observed by all employers while they are being employed, and the implications of their stay here. They equally deserve a good treatment as they indirectly aid our economic growth processes.
Economic regulation is no easy task for it demands a deep understanding and balancing of the interests of consumers, industries and the government. I am not sure many of our regulators understand deeply on these. There could be many employers who mistreat or abuse foreign workers, and such employers deserve heavy punishment under laws. Equally, those illegal foreign workers and their importers, who risked our national security should not go unpunished. There are many Malaysian employers who are unethical too and newspaper reports of them are abound.
I must say that our Immigration Department, especially under the current leadership Datuk Seri Mustafar Ali, has expedited many processes and procedures to assist deserving employers, the plantations for one, and also families who are in need of maids. His response to Felda Global Venture’s concern for labour shortage is exemplary. Further, the 2018 National Budget which further facilitated the recruitment of maids without using agents was a good gesture on the part of the government to families when both parents are working and contributing to the economy.
Of course, families must equally plan and manage their household work load by relying more on machines (washing machines and coffee makers, for example) as well as getting children to be more helpful at homes now, in order to rely less on outside workers more so even at home.
Overseas, the reliance on maids is no longer fashionable for the simple reason that their upkeep is costly in keeping with human rights demand, and wage laws. That said, the brunt of initiatives to rely less on foreign workers is the private sector employers. They just have to mechanise, automate, and computerise and go for more robots. There are ample incentives to go for these initiatives.
Private sector employers must internalise public policies in terms of objectives, spirit and expedience. In the short term, filling manual and menial jobs such as in the plantations, can be done by low-skilled foreign workers. It is also good to employ foreign workers for high skilled professions if Malaysians are not available or not adequate in supply.
The agenda behind the many permission and approvals being given by the Immigration Department is that the employers should assist the nation by undertaking initiatives to increasingly reduce their reliance on foreign workers while also trying to institute measures that foreign workers can be replaced by Malaysians.
They also need to pay better wages to attract more Malaysians who are otherwise unemployed on grounds of immobility. The percentage of national income that accrues to wages (about 32 per cent) is still behind the levels in developed countries (55 per cent). There is no excuse to suppress wages any more especially just to remain profitable and to retain investments. A business undertaking should be based on sound economics and not based on cost suppression and disguised subsidy in any form whatsoever. This is more enduring.
Yes, the reliance on external workers by Malaysian employers will stay with us, perhaps forever, especially as we modernise and transform. Malaysians have to be adopted in highly skilled jobs and therefore, the menial ones may have to be filled by others. Similarly, in the quest for economic transformation, we may need higher skills otherwise unavailable or available in limited supplies.
Having observed the many facets of dependence on foreign labour, clear policies on the use of foreign workers from short term, medium, and long term perspectives is necessary, and that employers are well advised to know and appreciate the implications of such policies for the sake of the country.
The brunt of initiatives to rely less on foreign workers is the private sector employers. They just have to mechanise, automate, and computerise and go for more robots. There are ample incentives to go for these initiatives.
The writer is chairman of the Malaysian Institute of Economic Research (MIER)