KUALA LUMPUR (Aug 21): A selective reopening of foreign worker quota applications falls short of addressing Malaysia’s critical labour shortages, manufacturers warned on Thursday.
The crunch pervades across almost all industries, the Federation of Malaysian Manufacturing (FMM) said in a statement. Furniture, rubber products, food processing, and electrical-and-electronic support services have the most urgent manpower needs, the trade body said.
“Many are facing critical manpower challenges due to workers returning home at the end of their contracts, inability to replace workers because of the prolonged freeze, and the most critical factor is the increasing orders arising from strong domestic and export demand,” FMM said.
The statement follows Wednesday’s announcement by Home Minister Datuk Seri Saifuddin Nasution Ismail that applications for foreign worker employment quotas will be open until Dec 31, limited to the agriculture, plantations and mining sectors.
Apart from the three sectors, ten other selected subsectors are also permitted on a case-by-case basis. Within manufacturing, the reopening is limited to new investments under the Malaysian Investment Development Authority.
“Through surveys conducted among its members, many of whom are existing investors, FMM is already receiving clear indications that labour shortages are putting significant pressure on business growth and long-term viability in Malaysia,” said FMM president Tan Sri Soh Thian Lai.
Even with the ten permitted subsectors, concern is that the case-by-case approval process may cause delays and uncertainty as the FMM called for more “transparent, efficient, and predictable” approvals.
It also urged the government to leverage technology in processing foreign worker applications with a centralised, transparent digital platform directly accessible to employers, which would allow applications to be submitted, tracked and approved.
“This would not only speed up processing but also eliminate the current reliance on agents lobbying for quotas, which has been a source of abuse and inflated demands,” Soh said.