Is ‘Malaysians@Work’ A Good Idea?

One of the key highlights of the Budget 2020 is the introduction of Malaysians@Work initiative, aimed to create better employment opportunites for youth and women, also to reduce over-dependence on low-skilled foreign workers. The Malaysians@Work is divided into four programmes as follows:

The programme is so far more like an ‘incentive scheme’, it is all about incentives. According to the Minister of Finance Lim Guan Eng, the Government anticipates that the Malaysians@Work initiative would create an additional 350,000 jobs for Malaysians and reduce over-dependence on foreign workers by more than 130,000. However, it would cost RM6.5 billion over five years, according to Lim.

Do we really need to spend this huge amount of money as ‘incentive’ for those who are supposed to work (e.g. the graduates)? If the purpose of doing so is to encourage the youths to work, the Government should instead ‘rewards’ those who are able to secure a job right after they graduate. Also, is giving out hiring incentives to the employers a correct way to create employment opportunites for youths and women? Wouldn’t employers simply just replace the elderly employees with the youths or women given the current economic condition?

The Government should look into the root causes behind the unemployment rate. What are the reasons for fresh graduates or women to be unemployed? What caused the country to be over-dependent on foreign workers?

According to Bank Negara Malaysia, between 2010 and 2017, the number of tertiary graduates entering the workforce surpassed the number of jobs created for them. Of the total vacancies in July 2019, 69.4% was for low-skilled jobs (MIDF, 2019). Skills mismatch is the main issue faced by our fresh graduates. In a survey conducted by the World Bank and Talent Corporation in 2014, 90% of companies were found to believe that graduates should have more industrial training by the time they graduate. However, less than 10% of companies had experience in developing relevant programmes with universities. Therefore, instead of giving incentives, the Government should solve the skills mismatch problem through funding on on-the-job skills training and/or internships of a year with relevant companies. And also create more job opportunities for our skilled labour force. The latter could be done by attracting more investments from foreign and multinational companies.

A two-year incentive for locals who replace foreign workers seems good on the surface but this is only a short-term solution. The low-skilled foreign workers are mostly employed in sectors that are deemed dirty, dangerous and difficult (3D). To reduce our addiction to cheap labour, technology and automation is a better solution. Thus, more should be allocated in helping the locals to acquire the right skills and knowledge in technology, as well as businesses to get onto the automation track with R&D.

It’s only 11 days after the announcement of Budget 2020. We need more details to see how Malaysians@Work will actually be implemented. What do you think about this programme? Comment below and let us know!

Reference:

1. 2020 Budget Speech by YB Tuan Lim Guan Eng

2. Bank Negara Malaysia (2018), Annual Report

3. MIDF (2018), Full-Employment Condition despite Challenging External Front