Malaysia has been reducing reliance on foreign labour in all sectors to buck the productivity decline trend.
On the contrary, over-dependence on help from overseas labour have dragged down manufacturing sector growth.
Investment Trade and Industry Deputy Minister Sim Tze Tzin said the difficult decision for the federal government to cut foreign workforce from the current 13 per cent to 10 per cent (by 2030) is to arrest the gradual falling productivity faced by the country.
Sim pointed out automation would be the driving force for manufacturing sector to surge forward, and took a leaf from several countries with the likes of Taiwan, Japan and Korea which have been keeping imported labour at bay.
“Without automation your businesses will not be competitive, let alone to survive.
“We need manufacturers to take deliberate, structured measures towards automation and digital integration and workforce upskilling (among local people),” he said in an address for the nomination opening for biennial Malaysia Smart Manufacturing Awards (MSMA) 2027.
Sim said in a bid to secure high value contracts, Malaysian manufacturers must demonstrate impeccable standards by deploying digital solutions, consistent product quality and reliable delivery schedule.
Sim, in a press conference after attending the official launch ceremony highlighted Malaysia to automate as many manufacturing processes, with the smart manufacturing factories record a meagre 93 outlets, a far cry from target of 3,000 outlets under new industrial master plan 2030,
He added MSMA awards would serve as a stepping stone for factories to automate, and the salary scale for Malaysian workforce will rise on the back of less dependence on foreign labour.
“Foreign labour reduction started back in 2018, so the process is a gradual reduction, it is slow and every sector, including relevant associations has been informed. My message is to start doing (increase automation) now,” Sim said when asked to comment about possible repercussions on less imported workforce on economy.
