TWO opposing trends — high outflow of Malaysian workers versus equally elevated inflow of foreign workers— must be increasing the worry lines of policymakers in Putrajaya. Start with the outflow of Malaysians.
To begin with, we start with a problem here. No one knows exactly how many Malaysians have migrated for work. The best is a guess: between 1.5 and two million Malaysians, according to a presentation made by the Economic Planning Unit on Oct 5 two years ago.
All we can say is our brain-drain rate is a high of 5.5 per cent, when the global average is only 3.3 per cent. As they say, what you can't measure, you can't manage. Any attempt to plug the brain drain must begin here. Metrics matter. This being said, the Statistics Department's 2022 study on Malaysian diaspora in Singapore released in February must have tried to get there. But being survey-based, it could only manage a tale of percentages and ratios.
Be that as it may, it has some useful information for policymakers to work on while pushing for comprehensive data. One is salary. While most earn S$1,500 to S$3,599, a good 18.5 per cent of Malaysians gross $3,600 to S$9,999. High salaries boosted by a favourable exchange rate of the Singapore dollar are among the reasons driving Malaysians there.
We can understand why professionals (20 per cent) are heading there, but clerical workers (24 per cent)? Machine operators (15 per cent) and technicians (15 per cent)? Low-wage Malaysia is pushing them south. We can't blame geography — the bulk of them (38.3 per cent ) are from Johor — especially when it comes with attractive salaries, good job prospects and better working environment. Malaysian employers and policymakers need to keep their eyes on these before our talent pool is hollowed out.
This brings us to our excessive reliance on foreign workers — the elevated inflow problem. According to Statistics Department data, there were 2.4 million foreign workers in 2022. This jumped to 2.8 million last year. Now we are being told that there are 3.4 million of them. Mind you, these are documented workers who are here legally.
We haven't accounted for the illegal ones, which unofficial estimates put it at between 1.2 and 3.5 million. Then there are foreign workers who fit neither category, like the more than 700 Bangladeshis brought in legally to work in Johor.
If media reports are right, they still have not been paid despite the Labour Department's directive to do so. Grey processes from request to recruitment create a vacuum which rogue firms exploit. This said, our economy comes with a design flaw. It is a model built on unskilled foreign labour as input. So long as this is not "unmade", our economy will chug along like the steam engines did in the years of yore.
Granted, it will be hard to grow the economy without any foreign labour. But before we ask ourselves how many foreign workers we need, we must ask what kind of economy we need. Surely, the answer is: one that is mostly run by Malaysians. Any other economic model will be unsustainable. Stemming the tide of outflow and inflow is a start.