Malaysia accumulating billion of losses on labour shortage

by NUR HANANI AZMAN / pic by TMR FILE

LABOUR-intensive industries are urging the government to resolve labour woes quickly across critical sectors as not all work can be automated as well as well derailing the economic recovery prospect.

To date, Malaysia’s rubber industry has lost RM30 billion in the last three years due to the lack of workers, while Malaysian Palm Oil Council (MPOC) warned the industry may not generate an extra RM20 billion revenue this year, due to the nationwide acute shortage of manual harvesters.

SME Association of Malaysia national secretary general Chin Chee Seong said small and medium enterprises (SMEs) are also facing a shortage of 300,000 workers involving food and beverage (F&B) manufacturing, furniture as well as agriculture sector.

“Service industry, of course, there is a shortage of workers for retail F&B and small contractors for renovation, logistics and transportation, they rely on these workers.

“Many local farmers are finding it difficult to get workers now with a shortage of foreign workers. So, we really need the government’s help to assist SMEs for survival,” he told The Malaysian Reserve (TMR).

Chin suggested the government do a campaign to encourage more Malaysians to take up unskilled jobs and tell them the salary is not that low.

“Foreign workers now are very demanding and asking for salaries from RM2,000 to RM2,800 with accommodation as well. The levy tax that the companies have to pay by the companies is huge too. 

“Hence, if locals are willing to take out the job, I think they can equally get a good pay,” he said.

In the longer term, he hopes that the relevant ministries and government agencies would engage with industry players to find ways to cut down dependence on foreign workers in order to move to a high-income nation.

Malaysian Footwear Manufacturers Association (MFMA) president Rachel Foo said the footwear industry is facing the same challenges especially when many are trying to commit to the order for the upcoming Chinese New Year and Hari Raya.

She is hoping the Ministry of Human Resources would decide on the ‘right’ number of foreign workers to be allowed to work in the country again.

“Not all industries can easily switch to ‘automation’ or interest from local workers. For example, Malaysian footwear is famous for strappy sandals, and to automate the process is very difficult, because it requires human skill and finishing.

“The government can consider starting with a minimum local vs foreign workers quota, and adjust it by each sector later on,” she told TMR.

Foo said of the standard operating procedure can be designed to cover many industries differently, the number of foreign workers can also be adjusted according to each industry’s request.

“We urge the government to reconsider the decision in bringing foreign workers. The situation of each industry must be studied individually. Human resource is a very complicated subject, no blanket rules should be applied across all industries,” she added.

Yesterday, the Ministry of Plantation, Industries, and Commodities (MPIC) said that Malaysia is now awaiting consideration from source countries, namely Indonesia, in relation to the mechanism to bring in foreign workers for the oil palm plantation sector.

Deputy Minister I Datuk Seri Dr Wee Jeck Seng said, Indonesia is still considering to send its migrants workers to Malaysia even though it had previously agreed to do so.

“Indonesia’s priority is to finalise the memorandum of understanding on the recruitment and protection of Indonesian domestic workers in Malaysia.

“That’s what I said that we depend on foreign workers but also depend on source countries which have agreements to send their workers to our country,” he told the Dewan Rakyat.

Federation of Malaysian Manufacturers (FMM) is of the view that in order for the industries, especially the export based companies, to bring the business outcomes to a level before the pre- pandemic level the general skill labour conditions in the year 2022 must be replenished with over 600,000 foreign labour workforce to fill the manpower gaps as quoted above as well as to cater for the some of the new investments that would still require some level of low skilled manpower for certain processes within their operations.

FMM president Tan Sri Soh Thian Lai said employers in manufacturing continue to face difficulties in sourcing for locals to fill the shortages in the unskilled general workers category arising from the current freeze in new recruitment of foreign workers.

“Industries have no choice but to rely on foreign workers as locals are not keen on certain jobs and industries especially in the dangerous, dirty and difficult or 3D sectors. This short-term measure is critical to the revival of businesses and the economy,” he said in a statement.

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Malaysia accumulating billion of losses on labour shortage