NCCIM Survey: Malaysia Is Facing Labour Shortage

As the economy recovers from the pandemic, there are numerous job opportunities for Malaysians, as employers urgently require workers in critical sectors such as manufacturing and construction.

Employers urge the government to resolve labour issues in these sectors as the economy recovers after nearly two years of on-and-off operations.

Datuk Low Kian Chuan, president of the National Chamber of Commerce and Industry of Malaysia (NCCIM), said the worker shortage was caused by several factors such as:

• Expired foreign workers' permits, 

• Poaching of workers by other sectors, and 

• The "open and shut" standard operating procedures during the various movement control orders.

 

Survey on worker shortage

The NCCIM's Quick Take Survey, which included 835 companies, revealed a 77,721 worker shortage, with:

• The manufacturing sector accounting for 77.1% of the total workforce required, 

• Followed by the construction sector (11.2%), and

• Other services (8.9% )

According to data compiled by industry associations:

• The construction industry requires 200,000 foreign workers,

• The plantation industry requires 70,000 foreign workers, 

• The services industry requires 45,000 foreign workers,

• The furniture industry requires 30,000 foreign workers,

• The manufacturing industry requires 25,000 foreign workers,

• The rubber glove industry requires 25,000 foreign workers, 

• The plastics industry requires 6,293 foreign workers.

He said the number of foreign workers now stands at 1.1 million, down 800,000 from 1.9 million in 2018. Meanwhile, the number of unemployed persons fell to 748,800 in August 2021, from 778,200 in July.

According to Low, even if a new addition of 250,000 unemployed persons were to fill the vacuum left by foreign workers, there would still be a shortfall of at least 500,000 workers, assuming some businesses right-sized due to the pandemic.

 

Foreign worker intake freeze

Last year, Human Resources Minister Datuk Seri M. Saravanan announced a freeze on new foreign worker intake until the end of 2020, intending to reduce their numbers while giving locals preference in securing employment.

In September, the Ministry of Human Resources extended the freeze on foreign worker recruitment until December 31.

Low stated that if the problem is not addressed, it will stifle business recovery, impede production to meet backlogged orders, and create uncertainty for new orders.

According to Low, many hard-hit industries, such as tourism, retail, and non-essential sectors run by SMEs, are still working hard to recoup revenue losses and repair their balance sheets.

He said businesses continue to face numerous cost-related challenges, including cash flow, rising raw-material costs, skyrocketing freight costs for exporters and importers, and a labour shortage.

 

Government assistance for industries

He hoped that the government would continue to provide some operational cost relief measures for hard-hit sectors in Budget 2022, such as:

• Wage subsidies, 

• Hiring incentives, 

• Rental relief,

• Targeted loan repayment assistance, and 

• Tax treatment.

Low added that measures to reduce the cost of raw materials include reducing import and excise duties on intermediate inputs, machinery equipment, building materials, and the provision of Market Development Grants to cover the logistic costs of export importers.

He suggested that while the government is in the process of allowing the intake of 32,000 foreign workers for the plantation sector, it can also work out a stop-gap solution to plug shortages in other major economic sectors to facilitate their recovery.

 

Source: The Star

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