Malaysia hikes expat minimum wage threshold

Malaysian lawmakers are investigating raising the expat minimum wage threshold in order to open up more jobs for local graduates.

In a bid to create more jobs for suitably qualified locals, the Malaysian government is looking into raising the minimum wage threshold applied to expat hirings. The move is expected to regulate the number of expat professionals taking on jobs which could well be filled by well-qualified if less experienced local talent. The minimum wage threshold is expected to be raised from RM 3,000 to RM 5,000.

The government believes taking choice away from employers will make it easier for as yet unemployed local graduates to prove they are suited for particular positions, and takes away employers’ freedom to concentrate on hiring foreigners. At the present time, some 3,550 expatriates are employed in the semi-skilled category, with the total comprising 71 per cent of all 71,000 foreign workers employed in the country.

Malaysian lawmakers believe the revision should be a part of a new government policy to reserve all semi-skilled jobs currently held by expats for local professionals. Semi-skilled workers earn between RM3,000 and 5,000, with no policy restricting the positions to locals as yet in place. It’s now believed only top managerial positions should be reserved for top-talent expat professionals, as local graduates do not yet have the skills or experience required for managerial jobs.

In addition, the Malaysian government is prioritising the Returning Expat Programme which, at present, doesn’t provide adequate salaries for Malaysian professionals considering returning to the home country after a stint working overseas. The programme has been on the books for 10 years, but has failed to attract top talent due to low remuneration. A number of those who’ve returned have found it too difficult to maintain their preferred lifestyles and have been forced to accept overseas positions as a result.