Malaysian labour market rebounds despite high migration cost

Infographic: TBS

Labour export to the high-demanding Malaysian labour market has witnessed a rebound amid complaints of higher migration cost than the fixed rate as the South-East Asian country recruited the second highest number of workers from Bangladesh in last month.  

Malaysia recruited a total of some 25,000 workers in January 2023 alone, while Bangladesh exported 50,090 workers to the country last year, according to the Bureau of Manpower, Employment and Trading (BMET).

The total labour export figure was 1,04,513 in January this year while Saudi Arabia recruited the highest 42,697 workers (40.85%), Malaysia 24,994 (23.91%), followed by Oman 17,694 (16.93%) and the United Arab Emirates 6,584 (6.30%).

The present recruitment trend to Malaysia shows that Bangladesh can export 3 to 4 lakh workers by the end of the year to the Southeast Asian country.

However, sector insiders said that the aspirant migrants are being exploited to pay more than Tk4 lakh as migration cost though the government has fixed the rate around Tk79,000. 

They mainly blamed the syndication of recruiting agencies who are currently allowed to send workers in the country.

Currently, only 100 Bangladeshi agencies are allowed to send workers where the registered number is more than 1500.

An aspirant migrant from Feni who wants to go Malaysia told TBS on Thursday, "I initially contacted an agency to go as a construction worker. They promised to take Tk3.65 lakh but ultimately failed. Then I contacted several other agencies who were asking Tk4.20 to 4.40 lakh."

Bangladesh and Malaysia on 19 December, 2021 signed a MoU on the employment of Bangladeshi workers in the Southeast Asian country after a hiatus of over three years.

However, the recruitment process remained stalled till August last year as the MoU was widely criticised by the recruiting agencies and other stakeholders for allowing a limited number of agencies to send workers.

"Initially, the migration cost was between Tk3 and 4 lakh, which has reached Tk4.5 to 5 lakh. The agencies that have syndicated, have to share money at different levels," Md Tipu Sultan, joint secretary of Bangladesh Association of International Recruiting Agencies (Baira) told TBS.

"However, we hope that the syndication will stop in the future as the new Malaysian government led by Anwar Ibrahim takes a stand against labour exploitation. We have already given written letters to the Prime Ministers of both countries," he added.

In such a situation, both the countries have agreed to review the existing MoU to reduce the cost and make the recruitment process faster. 

The expatriate welfare ministry sources said that a joint working group meeting is scheduled to be held in the first week of March this year.

"We will speed up the process (hiring) and the Malaysian government is committed to reducing the migration cost," Malaysian Home Minister Saifuddin Nasusan Ismail said while visiting Bangladesh this month.

Mohammad Abul Bashar, president, Baira told TBS, that they are against the syndication of manpower export to Malaysia and will leave no stone unturned in boosting manpower to the Southeast Asian country.

According to the Malaysian government's new salary structure, the newly recruited workers will get a salary of at least 1,500 Malaysian ringgit (equivalent to Tk37,000) per month.

In addition, they will be entitled to all other benefits, including overtime, free accommodation, health insurance, accident insurance at the workplace as per the Malaysian law.

It is expected that in the next three years, more than 5 lakh new workers from Bangladesh will be employed in Malaysia and through this, the total remittance sent to Bangladesh from Malaysia will exceed $3 billion, according to the Bangladesh High Commission in Malaysia.

The recruiting agencies said that Malaysia is a more preferable destination for Bangladeshi workers than the Middle East for its comparatively better salary structure and almost similar weather conditions of Bangladesh.

The new deal has opened the recruitment of Bangladeshi workers in all sectors including plantations, agriculture, manufacturing, services, mining, construction, and household services. 

The Malaysian labour market is expected to strengthen further in 2023.

Malaymail, a Malaysian news outlet recently reported that the labour market is expected to strengthen further in 2023, underpinned by upbeat momentum in the domestic economy and modest expansion in the external sector, said MIDF Research.

"Malaysia's job market in 2023 is anticipated to continue benefiting from firm domestic demand, China's reopening, the revival of construction projects, expansion of primary sectors thanks to elevated global commodity prices, and modest external trade activities.

"In addition, we view that the recently concluded general election should reduce domestic political temperature and allow for better and smooth implementation of fiscal policy," the research house said.

Bangladesh exported a total of 11,35,873 workers during the January-December period of the last calendar year as against 617,209 during the same period of the previous year 2021.

However, the year ended with $21.29 billion sent home by workers abroad, down from $22.07 billion of the past year – a decline attributed to global economic slowdown and a surge in hundi transactions due to exchange rate mismatches.

The figure is not commensurate with the whopping 82% growth in manpower export as overseas job market analysts believe it may take some more months for the newly-hired workers to be able to send money home. ***