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FMM PRESS STATEMENT: Industry Appeals for Government to Lift the Freeze on Foreign Worker Recruitment To Support Business Recovery

Kuala Lumpur, April 7, 2021 – The Federation of Malaysian Manufacturers (FMM) calls on the Government to lift the freeze on foreign worker recruitment for the manufacturing sector to support the pick-up in business and assist the industry in their business recovery as orders and production start to gain momentum. In particular, FMM appeals for the Government to allow the intake of foreign workers for the export-based companies and companies especially the SMEs that support the export market. The recently released FMM-MIER Business Conditions Survey 2H2020 revealed that while manufacturers continue to be cautious with their outlook, there are indications of improvements.

FMM thanks the Government for the continued support provided through the various stimulus and economic recovery packages which have assisted businesses to overcome the challenges faced as a result of the pandemic in particular cash flow constraints and meeting fixed capital costs including employment costs. Sustaining operations in the past year had indeed been challenging for many.

The industry over the past year has had to repatriate workers due to expiry of the workers’ permits as well as some had their existing workers stuck at their home country when the global lockdown was instituted and have since not been allowed to re-enter the country due to the pandemic and closure of borders. While the industry endeavours to fill those vacancies with locals, foreign workers are usually employed to fill up general operator-level jobs which employers are finding difficulty to be filled by locals due to the nature of the job or industry and job expectations of locals.

At the same time, manufacturers have started exploring more proactive deployment of digital and automation technologies to lower the worker density in their operations including reducing dependence on foreign workers. However, the switch to more automated processes and adoption of digitalisation will take time and substantial investments and in the meantime, businesses have to continue to sustain and grow and thus their labour requirements must continue to be supported.

Manufacturers, especially exporters and the supporting SME businesses recovery initiatives must continue to be backed with the necessary initiatives including support on manpower requirements which could otherwise derail business recovery or land the industry in deeper problems when they are not able to fulfil their orders during this critical period.

With that said, FMM has always advocated for the need for the industry to gradually reduce their dependence on foreign workers with the changing manufacturing landscape as well as for the nation to transition into a high income economy. However in doing so, the Government must have in place a more holistic, fair and transparent management and administration of foreign workers in order to facilitate this transition to take place gradually via a market based mechanism which would serve as a natural mechanism for industries to re-evaluate their business models.

Tan Sri Dato’ Soh Thian Lai
President, Federation of Malaysian Manufacturers

FMM Advocates Transparency, Integrity and No Corruption

About FMM
The Federation of Malaysian Manufacturers (FMM) has been the voice of the Malaysian manufacturing sector since 1968. Representing over 10,000 member companies (3,000 direct and 7,000 indirect) from the manufacturing supply chain, FMM is actively engaged with government and its key agencies at Federal, State and local levels. FMM is also well-linked with international organisations, Malaysian businesses and civil society. Apart from benefitting from FMM’s advocacy, FMM members enjoy value-add services, including training, business networking and trade opportunities as well as regular information updates.

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