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MARKET DEVELOPMENT
One good reason to relocate industries abroad
calendar24-12-2004 | linkThe Star | Share This Post:

Friday December 24, 2004 - TRADE unions are the ones which object the mostto any relocation of industries or businesses to another country as thiswould mean job losses for the locals.

On the surface, this is a valid argument as workers would have to beretrenched if any industry or plant shut down its facilities because itcould no longer be competitive due to high labour cost.

However, there are always two sides to a coin.

At first glance, Malaysians will lose jobs if there should be suchclosures.

But what some groups may ignore is whether the affected workers werereally the locals.

Over the years, Malaysia’s quick economic growth and development hasresulted in a serious shortage of workers and what is unnatural is thatMalaysians are shunning such jobs because they consider the pay as toolow.

So to keep their businesses going, many employers have no choice but tolook towards the region for workers.

What is the use of starting factories or plantations when the jobs createdgo to foreigners and not Malaysians?

Under such conditions, would it make any difference if suchlabour-intensive industries were to be relocated abroad where workers areeasily available and at a lower cost too?

It is a fact that we have to hire foreign labour to keep these operationsgoing and so it is better if the investors should move their operationssomewhere else.

This in a way will help to reduce the number of foreign workers in thecountry.

The industries most affected by worker shortage are in the manufacturing,construction and plantation sectors.

These are menial jobs and hence the locals have refused to work in thesesectors.

The unions say that the lack of interest shown by the locals is due to thelow wages these sectors are paying.

But there is no minimum wage policy in Malaysia and the Government hasrealised that even if one were to be introduced, there would be difficultyin fixing the right quantum.

It is felt that this matter should be decided by market forces andindividual firms or industry.

The Malaysian Trades Union Congress insists that the minimum wage shouldbe RM900 a month.

This figure can never be implemented across the board as employers areonly prepared to pay workers according to their educational qualificationsand ability.

Therefore, if the employers are unable to recruit workers in the threecritical areas, their businesses would be badly affected and the economywould suffer.

There is really an urgent need for the plantation sector to move toIndonesia as Malaysia is running out of land for this industry whichrequires large tracts of land for rubber or palm oil.

Indonesia is the logical choice as many of its citizens have been involvedin plantation work in Malaysia and therefore have acquired the skills andexperience to qualify them for such jobs.

The plantation owners will not need to train them and this will enabletheir projects to progress with minimum delay.