Malaysia is one of Asia's biggest employers of foreign labour. But recently, cases of deaths, abuse and forced labour have come to light. What is going on? Who is protecting these migrant workers?
MALAYSIA’S policy
towards guest workers has been ad hoc and incoherent. One may even question, in
this context, if there is any policy at all.
<P>All this may have much to do
with the haste in which Malaysia resorted to foreign workers in the early 1990s,
initially to meet acute labour shortages in the plantation sector, and subsequently
to keep wages low in the manufacturing sector in the name of export competitiveness.</P><P>Getting
foreign workers to make up for the exodus of locals from the harsh working environment
in the rubber and oil palm plantations, of course, makes good sense. In the absence
of foreign workers, Malaysia’s primary exports would have come to a grinding
halt. This logic, however, does not apply to the manufacturing sector.</P><P>For,
in the absence of foreign workers, the manufacturing sector would have resorted
to labour-saving technology, with higher productivity keeping tabs on the cost
of labour in the face of rising wages. Higher wages do not translate into higher
labour costs where productivity leads and wage follows.</P><P>In the absence of
foreign workers, Malaysia would have moved up the value chain through industrial
upgrading, moving away from low value-added unskilled labour-intensive manufacturing
to high value-added skill-intensive operations.</P><P>All this was unfortunately
thwarted, if not torpedoed, by the influx of "cheap" foreign workers
who took away the pressure on the manufacturing sector to automate. Malaysia has
apparently shot itself in the foot by denying itself a golden opportunity to learn
to produce more with less labour.</P><P>Be that as it may, the fact remains that
foreign labour is not really as "cheap" as it may appear. While the
usage of foreign labour may have saved costs for companies, the "social costs"
to the country are far greater.</P><P>The social costs include the strain on public
services such as health and education, crimes committed by migrants and diseases
brought by them into the country. It is estimated that the unpaid medical bills
of foreign patients amounted to RM11 million in 2004. Nearly 40 per cent of the
prisoners in the country are foreigners, with the government reportedly spending
RM489,090 daily on them. The numbers are staggering. There are roughly two million
registered foreign workers, not to mention the undocumented ones estimated at
over 700,000.</P><P>In other words, foreigners account for over one-fifth of the
workforce. The manufacturing and plantation sectors are among the biggest users
of guest workers, accounting for about 30 per cent and 20 per cent of the migrant
workers in the country, respectively, followed by domestic services (17 per cent)
and the construction sector (15 per cent).</P><P>Lessons have been learnt. Efforts
are underway to reduce Malaysia’s dependence on foreign workers.</P><P>The
Third Industrial Master Plan (IMP3) strategy is, not only to move up the value
chain, but also to lift the value chain vertically so as to increase the contribution
of capital and technology to output growth at the expense of unskilled labour.</P><P>It
is also commendable that Malaysia has rejected many investment applications with
requests for more migrant workers. It makes sense ceteris paribus to take the
plantations and factories abroad, where the workers are, than to bring foreign
workers to the plantations and factories at home.</P><P>To be sure, generalisations
are often perilous. Not surprisingly, the supply and demand conditions governing
the labour market vary from sector to sector and from place to place. Foreign
workers do not compete with the locals so long as they are confined to fields
shunned by the latter.</P><P>These are often dubbed as "3D" (dirty,
dangerous, difficult) jobs, which include those in plantations, construction and
domestic service. Malaysia will continue to need the services of foreign workers
in the so-called 3D activities.</P><P>Besides, Malaysia’s demand for foreign
skilled workers will rise as the country moves up the value chain, given the shortage
of local skills.</P><P>There are over 35,000 expatriates in the country, employed
as professionals, specialists and skilled workers and their numbers are likely
to grow over time.</P><P>The unskilled migrant workers are particularly vulnerable
to abuses of all sorts. They tend to be exploited, not only by agents who bring
them into country, but also by employers who make them work under slavish conditions.</P><P>The
agents, eager to earn their commissions, promise them four-digit salaries, which
entice the gullible migrant workers to fork out large sums to gain entry into
the country, only to find that they have been cheated.</P><P>Migrant workers often
end up being overworked and underpaid. What is more, the burden of the levy of
RM1,200 per year per worker, a price that an employer has to pay for employing
a foreigner, is passed on by employers to foreign workers through salary deductions
every month.</P><P>Some of the guest workers, unable to pay the levy or other
onerous payments to the "middlemen", become illegal immigrants in the
process.</P><P>Others who move over to greener pastures also break the laws for
working in the wrong place, even if they have valid work permits. When they get
caught, they are packed into overcrowded detention centres where life becomes
a nightmare.</P><P>It is important to understand that migrant workers become illegal
not by choice but by chance. Errant agents and unscrupulous employers who drive
migrant workers to the brink go unpunished.</P><P>There is a need to protect the
migrant workers who contribute much to the country’s development.</P><P>They
cut the lawns, clean the toilets, mop the floor, wash the cars, launder dirty
clothes, cook the meals and undertake many more chores, which locals do not want
to touch with a 10-foot pole. The government must put in place mechanisms that
protect the migrant workers from abuse and exploitation.</P><P>Some flexibility
in the choice of workplace for guest workers would go a long way, not only in
removing the rigidities that breed horror, but also in allowing the market to
allocate resources more efficiently.</P><P><B>Professor Emeritus Mohamed Ariff
is the executive director of the Malaysian Institute of Economic Research.</B></P><P><I>Source:
http://www.nst.com.my/Current_News/nst/Saturday/Columns/20070217083743/Article/index_html</I>
Address: Wisma MTUC,10-5, Jalan USJ 9/5T, 47620 Subang Jaya,Selangor | Tel: 03-80242953 | Fax: 03-80243225 | Email: sgmtuc@gmail.com.com