The Relationship Between Foreign Workers Dependency and Malaysian UnemploymentABSTRACTThe issue of foreign workers has received increase media and national attention. The transitionof employment system has stirred unemployment rate in Malaysia at devastated level. Foreignlabour has become an increasingly attractive option for employers as it supported by policiesthat variously less regulatory and certification processes and fast track work permit approval.This global interdependencies and inequalities complex phenomenon have created scarcityamong local employees where distribution of gains and losses increasingly unequal whereasthe pressure for the government to develop labour policies is intensifying. Furthermoreintroduction of significant changes in recruitment phenomenon has ended in painful andtraumatic atmosphere which barely acceptable by local workforce in Malaysia. This articlediscussed on relationship between number of foreign labour increases and the unemploymentof local labour in Malaysia whereby secondary data have been collected and tested by usinganalysis and simple regression analyses.
1.0INTRODUCTIONMalaysia’s transformation from an agricultural based economy to manufacturing or servicebased in the early 1990s has moulded the country into a magnet attracting foreign workers. Thisphenomena of the influx of foreign workers gain further momentum with the advent of theimplementation of WTO rules on trade. Currently, Malaysia hosts foreign workers fromnumerous Asian countries particularly Bangladesh, Indonesia, Nepal and Myanmar. Initially theirarrival to Malaysian shores solicited a mixed reaction from all stake holders concerned.However, during the 1997-98 World economic crisis and once again in economic downturnrecently, Malaysia’s resolve as one of the Asian Tiger economy is severely tested. Despite itsinitial solid economic foundation, built largely on the platform of cheap foreign labour that wasexpected to withstand the economic onslaught, the country weathered the crisis severelybruised. Its dependence of cheap foreign labour compounded the situation further withaccusation directed mainly by local labour unions, Non-governmental organization etc thatcontributed to local unemployment. The debate on the impact of foreign labours and localunemployment is still raging for nearly 16 years without any conclusive outcome.1.1 CURRENT SITUATION IN MALAYSIACurrently government has agreed to approve the recruitment of foreign workers from Africanand India to meet the demand in 13 small-scale business sectors, which are facing manpowershortage in year 2018. Human Resources Minister M. Kulasegaran said the approval was givenafter considering the plight of businessmen in these sectors such as restaurants, grocery shopsand the textile industry, which was raised in a memorandum submitted by the MalaysianAssociated Indian Chamber of Commerce and Industry (MAICCI) to the Prime Minister.