In Iskandar, SMEs face same old labour crunch

[Enye]

stay in singapore complain to singapore govt

 

move to johor also complain to malaysia govt

 

better ask malaysia govt to allow more FTs

 

land bigger can absorb more

 

 

Some firms put move on hold; M'sian minister says KL will try to resolve the problem

Mr Mustapa: The dearth of human capital tops the concerns of Singapore businesses looking to move to the Iskandar region, he said.

 

[sINGAPORE] Businesses that are looking to set up shop in Iskandar Malaysia to escape the tight labour market here may face a similar set of problems across the Causeway - a lack of skilled labour to support their operations.

 

The dearth of human capital tops the concerns of Singapore businesses looking to move to the Iskandar region, said Malaysian International Trade and Industry Minister Mustapa Mohamed. He was in Singapore yesterday to meet companies looking to expand or relocate there.

 

Mr Mustapa told reporters that he had met with the chairman and 12 board members of the Singapore Chinese Chamber of Commerce and Industry (SCCCI) and separately with six Singapore-owned SMEs yesterday to address concerns they had about moving to Iskandar.

 

"Labour keeps cropping up (in discussions)," said Mr Mustapa. He noted that the companies he spoke to did not have too many issues otherwise but the lack of skilled personnel stood out. He said it was a universal problem.

 

Nevertheless, it is a pressing concern for Singapore SMEs looking to expand there because there is "no point setting up business there if you cannot get people to work", said Chan Chong Beng, president of the Association of Small and Medium Enterprises (ASME) here. However, he said that the shortage of workers in Iskandar is not surprising, considering that Malaysia as a whole is facing a dearth of skilled manpower and even Kuala Lumpur has not been spared.

 

Part of the problem with Iskandar is that a high proportion of the skilled labour in Johor already plies daily to Singapore to work here. "The lack of manpower there is a very important issue as most of the skilled labour nearby is already coming to Singapore to work," explained Douglas Foo, CEO of Sakae Holdings whose plans to move there hinge on this issue being resolved.

 

"We need to convince some of our colleagues (in Singapore) to assist (in reducing their demand of skilled labour here) if we are to move forward with our plans," he added.

 

Mr Chan agreed that the inflow of skilled Malaysian labour into Singapore hampers ASME members' plans to expand into Iskandar. But he said that some SMEs here are exploring ways to overcome this structural problem.

 

"A lot of SMEs here are asking their Malaysian labour here, especially those that travel into Singapore every day, to stay in Johor and work in their operations there instead. In return they are even offering to continue to pay them in Singapore dollars," Mr Chan said.

 

In the interim, SMEs here are even asking their Singapore staff to work in their Iskandar operations, although Mr Chan admits that this will not be a sustainable solution in the long term.

 

Shifting the supply of labour from Singapore to Johor may just add more pressure to the already tight labour market here. And paying workers in Malaysia in Singapore dollars or sending Singapore workers to work there will only increase the cost of labour in Iskandar, which could ultimately erode the cost advantage Iskandar has to offer.

 

According to Mr Mustapa, the Malaysian government recognises the problem and is taking steps to address it. These include working with companies to identify Malaysian university graduates and training them in the required specialised skills.

 

It's not just the SMEs that are worried. Even large companies here, that are looking to Iskandar as a cheaper cost alternative, are hesitating in moving because of the labour shortage, Shankar Iyer, the former chairman of the Singapore International Chamber of Commerce (SICC) told BT.

 

The problem may only worsen as the Iskandar region develops due to the increased demand for labour, especially if infrastructure does not grow adequately.

 

"If you look at Nusajaya and Medini, there are very impressive projects coming up, but the problem is basically manpower in general, not just skilled labour, and part of this is because there is inadequate infrastructure to bring the people in from the rest of Johor," said Mr Iyer, who is chairman and CEO of The Iyer Practice.

 

As Iskandar grows, the rise in SMEs there, both domestic and foreign, will increase the demand for manpower. There are almost 70,000 SMEs registered in Johor now, with 85 per cent of them operating within Iskandar.

 

As at the end of the first quarter of 2013, the cumulative committed investment coming from Singapore into Iskandar Malaysia stood at 6 billion ringgit (S$2.4 billion). According to Ismail Ibrahim, the chief executive of Iskandar Regional Development Authority (IRDA), out of this amount, as much as 5 billion ringgit of investments into Iskandar are from Singapore manufacturing companies, most of them SMEs.

 

 

 

 

[SPT27AAA]

Yup those oreadi planned long time ago are oreadi in midst of transfering production over

They will bring their jb workers who cross to work here to stay there n pay remain

So they oreadi save on the levy part Liao

But if boleh govn were to do this levy thing then LPPL Liao

One levy here can pay fully for a worker in jb Liao

 

Only huge operation wil have difference, the small ones dun bother to move la

[Myxilplix]

Is anyone actually surprised?

[Kangadrool]

Not surprised lah. In fact, the Malaysian locals are also lamenting about the influx of FT/FWs. Food standards have dropped - last time cooked by local, now replaced by Burmese......

 

At Genting foodcourt, the food prices is the same as those in Marina Sands FC after currency conversion.

 

Song bo? Last time, comprain Singaporeans don't want work, now go Boleh Land, comprain Malaysians don't want work.... If there's a way for employers not to pay employees legally, they will.

 

I think if they move to Indonesia, Pinoy land also same problem one de.

Edited July 10, 2013 by Kangadrool

[LoverofCar]

frankly...moving to bolehland for low cost is one thing...companies will still face problem with labour as majority of the remaining labour forces are lower educated one as the high qualification workforce had already moved to singapore to earn sing dollar...unless they get the same money there in bolehland...Singapore still an attractive place for them...

Edited July 10, 2013 by LoverofCar

[Tireburner]

Jia lat ah doing business.here or across the causeway.

Better invest I'm equities and earn dividends or capital appreciation.

Boh ah ni tau tiah...

[Kangadrool]

Jia lat ah doing business.here or across the causeway.

Better invest I'm equities and earn dividends or capital appreciation.

Boh ah ni tau tiah...

 

If they can't survive in Singapore, don't think they can survive anywhere else.

[Icedbs]

I don't see the problem...

 

Low level workers can get from Johor. This one sure no issue.

 

High level ones, send in Singaporean as an expat. I am sure Singaporean won't mind....afterall Iskandar is so near.

 

It is the same for US companies shifting operations to China. Low level staff, get from China, high level ones they send in from US as expats.

 

 

[Mustank]

I don't see the problem...

 

Low level workers can get from Johor. This one sure no issue.

 

High level ones, send in Singaporean as an expat. I am sure Singaporean won't mind....afterall Iskandar is so near.

 

It is the same for US companies shifting operations to China. Low level staff, get from China, high level ones they send in from US as expats.

 

maybe the MY workers are not low cost enough

maybe they are asking MY Govt to allow in super low cost workers from myanmar or africa for maybe $200 a month

[IcyFire]

Perhaps the right question to ask is if these SMEs are actually viable? Why have that many SMEs clamouring for labour when their individual orders cannot justify capital investments? Will the truly enterprising SMEs step forth and do some M&A? Perhaps that will address the issue somewhat.

[TVT]

It won't be easy to resolve this issue unless Malaysia allow low cost foreign workers in to do the work.

 

Those Malaysians already going into Singapore daily to work may not necessary want to switch back to Iskandar, unless they are promised the same pay they get in SG. But do you think companies in Iskandar are willing to pay so high for labour?