How Many Migrant Workers in Malaysia?

One of the enduring mysteries in Malaysia is the number of migrant workers. The official figure is 2.1 million. But that may not be true. This figure is important because it will tell us the magnitude of the problem. Getting a proper grasp of the problem is key to lifting living standards for most Malaysians 

In 1983 Dr Mahathir Mohamad took the route of cheap labour and low value-added industry to fuel growth. In late 2014, then human resources minister said that there were 2.1 million documented migrant workers and 4.6 million undocumented, making a total of 6.7million.  About 70 percent of migrant workers were undocumented! This figure was based on mobile phone data which indicate a high degree of accuracy.

Source: https://www.wikiimpact.com

In a paper by Lee Hwok-Aun and Khor Yu Leng, published in April 2018 the estimated the minimum number of migrant workers at about 3.85 million and “possibly around 5.5 million”. That distorts economic performance considerably. If we use the 6.7 million figure - that implies an additional 4.7 million workers to the legal workforce of 15 million.

Worker productivity will be much higher because 4.7 million workers are not recognised, distorting the figure upwards. Also, understating the population by 4.7 million pushes the per capita income higher by the same percentage. We have misleading data on labour and migrant workers which then distorts all policy initiatives on labour, productivity, wages and other related issues.

Malay poverty, and the poverty of other Malaysians are due to governments failing to address the data capture issue, and it starts with Mahathir. And these same people now talk of Malay poverty, ignoring their role for the situation in the first place. To rectify we need to do the following:

 

(i) Get the data right and be brave to face the situation. We need valid estimates of migrant labour - both documented and undocumented. Only then we have a plan to reduce migrant labour, over a period.

(ii) Employers must be incentivised to automate, innovate and optimise operations for higher productivity. 

When we do the above then our policies will match the data and we are on the road to a developed nation.

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Comment: Just how many migrant workers are there in Malaysia? P Gunasegaran, Malaysiakini, 21 March 2023