KUALA LUMPUR, July 18 — The decision to defer the implementation of the 80:20 ratio for local to foreign worker quota in the manufacturing sector will certainly provide a relief to the business community, said a group of industry players.
In a joint statement, industry players comprising 51 industry organisations, trade associations and chambers of commerce, lauded the decision by the Ministry of International Trade and Industry (MITI) for the two-year deferment of the ruling since the lifting of the freeze on foreign worker recruitment from Feb 15, 2022.
It said the business community, either directly or indirectly, has been impacted by the 80:20 ruling as manufacturers as well as their suppliers, vendors, contractors, and customers are all part of the supply chain that ultimately affects the consumers.
“The imposition of this ruling has impacted the ability of our industries to meet their sales orders and meet their obligations as part of the global supply chain.
“It has significantly affected the ability of industries to ramp up operation capacity as well as expand operations to meet increasing global demands,” said Federation of Malaysian Manufacturers (FMM) president Tan Sri Soh Thian Lai on behalf of the business community.
Labour shortages have led to companies experiencing delays in fulfilling delivery of goods, huge backlogs, loss of existing customers, and loss of potential business, he said.
“Businesses are also currently under tremendous pressure to contain increasingly challenging high operating costs given the rising inflationary pressures.”
The business community also reiterate that the process to reduce dependency on foreign workers through automation is already taking place, but it is a gradual process that must continue to be supported by the government.
“It must also be recognised that not all traditional labour positions can be replaced with automation, and as such, there will continue to be a demand for labour to fulfil this manpower requirement.
“Hence, the demand for shop floor workers cannot be equated to the lack of efforts by industries to automate,” said Soh.
