THE Human Resources Ministry has outlined a new policy to hire foreign workers and expatriates as a measure to overcome this year’s staggering unemployment rate in Malaysia. While we agree that unemployment is a critical issue, especially with fresh graduates entering the job market, we believe that this new hiring policy is a move in the wrong direction.

Firstly, prioritising employment of local employees does not guarantee talent development within enterprises. In other words, only hiring local workers does not ensure the improvement of the competitiveness of Malaysian businesses. A competitive talent pool is nurtured through collaborative innovation with the best ideas, the most creative minds, and the most skillful individuals from all over the world. In fact, Malaysia as one of Southeast Asia’s talent hubs stands to gain multiple benefits from brain circulation and brain linkages from increased labour mobility across the Asean region.

On the flip side, the proposed inefficient and non-investor friendly policy will deter multinational corporations from setting up operations in this country, which is bad news during the economic recovery phase. This is all the more worrying when our Asean neighbours, including Vietnam and Indonesia, are soaring in terms of investment attractiveness, leaving Malaysia as a less attractive option. When foreign direct investment is discouraged, the creation of job opportunities especially for fresh graduates will begin to slow down, worsening unemployment in the long run.

Secondly, some government agencies are not supposed to be responsible for any employment process. For instance, the Social Security Organisation (Socso) was proposed to interview employee candidates through the national employment portal, but Socso should just focus on its role as a worker security agency. In addition to that, agencies’ involvement in the expatriate hiring process will be invasive and an intrusion to companies’ privacy. The government should just leave the industry alone, instead of interfering with corporate decisions to hire foreign skills, because the agencies clearly do not understand the needs of the private players.

Thirdly, there are other avenues that the government can explore to tackle unemployment. For example, the best way to help local employees is through reskilling and upskilling programmes. Workers need to equip themselves with necessary skills (based on high arts, high tech, and high touch) in order to be relevant in the current and future job market.

Besides that, fresh graduates need to improve their university learning experience, so that they can prepare themselves to compete in the real world. One way to improve learning experience is through greater exposure and collaboration with firms that employ foreign talents.

In addition to the proposed solutions listed above, Bait AlAmanah supports the measures suggested by Centre for Market Education (CME), which include the following:

• The opening of a discussion table with the relevant stakeholders before implementing such measures, rather than after they are in place.
• Identification of a salary threshold above which the new procedure will not be applicable, and businesses will be free to hire without using the portal but only through the traditional channels.
• Exclude work-permit renewals and business-owners from the scope of the policy.

In conclusion, it is understandable that this new hiring policy received quite a backlash from economists, labour market experts, small and medium enterprises (SMEs) and business groups including EuroCham and AmCham. We hope that the Human Resources Ministry will reevaluate the decision to implement this policy and consider the measures proposed above instead. Also, it is highly important for policy makers to carefully think through policies and hold engagement sessions with corporate leaders and business associations, for the betterment of Malaysia’s future. – November 4, 2020.

* This is a joint statement by Abdul Razak Ahmad, Fariq Sazuki and Benedict Weerasena of Bait Al Amanah.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.