With locals out of jobs, why the need for foreign workers?

The federal government lacks a clear route map on migrant workers as well as the local labour force in general.

COMMENT

By Steven Sim

When the federal government announced its plan to bring in 1.5 million Bangladeshi workers over three years – an average of 500,000 migrant workers a year – it said that it was because certain sectors such as manufacturing and agriculture needed workers.

Migrant workers may potentially make up 50 per cent of our total employment by 2018

As it is, we already have 2.1 million legal migrant workers. According to the government, they are allowed to work in five sectors, namely, construction, manufacturing, plantation, agricultural and services.

The government estimates that migrant workers consist of 17 per cent of total employment in the country and aims to reduce it to 15 per cent by 2020.

This however is an overtly conservative figure given that there are about 2-3 million unregistered migrant workers who may be working one way or another to survive. In other words, migrant workers, both registered and unregistered, potentially make up a third of our total employment.

With another 1.5 million Bangladeshi workers coming in, migrant workers will be almost half of our total employment by 2018. This is in the context of 400,000 unemployed Malaysians, a quarter of whom are varsity graduates.

No jobs for locals

Oddly enough, despite the government claiming we need an additional 500,000 migrant workers every year for the next three years, jobs for locals are dwindling.

By the end of last year, it was estimated that 25,000 people were laid off in Malaysia. On its own the figure is already a major cause of concern, but compare this to the year before, we immediately feel the gravity of the situation: the 2015 retrenchment figure doubles that of 2014.

The Malaysian Employers Federation indicated there will be more job cuts in 2016. Human Resources Minister Richard Riot had warned that this trend will be extended into 2017.

With the signing of the TPPA early this month, SMEs in Malaysia have already warned that 30 per cent of Malaysian SMEs, which are important job providers, may be forced to close down.

Thus, which industry is actually in need of the 1.5 million Bangladeshi workers?

Growth for all five sectors are slowing down in 2016

Table 1: GDP growth rate by sectors from 2012-2016

In the next one year, growth for all the five sectors will be reduced far from their five-year highest growth rate. Hence it is not surprising that the job market is and will continue to be slow until 2017 as acknowledged by both the government and the industry.

Hence, where exactly are the vacancies for the 1.5 million Bangladeshi workers on top of the existing 2.1 million migrant workers?

From the figure of migrant workers by sector in early 2015, counting the 2.1 million at this point, we already have an additional 150,000 to 200,000 migrant workers today. This is not counting the numbers from recent rehiring programmes as well as other unregistered migrant workers. And the government is now telling us, we still need 1.5 million more?

Table 2: Number of migrant workers in Malaysia according to sector in 2015Q1

As I have said in my earlier statements, the federal government lacks a clear route map on migrant workers as well as our labour force in general. As such, our migrant workers policy is “disorganised, haphazard, random and senseless.”

Worse still, instead of seeing the import of migrant workers as supporting local businesses, the government sees it as a business in itself. It is a multi-billion ringgit business dominated by a handful of Umno linked cronies. Thus, there is no incentive to properly organise and manage migrant workers to match the real needs of the industry.

Steven Sim Chee Keong is MP for Bukit Mertajam and Deputy Spokesperson, DAP Parliamentary Committee on Human Resources.