"Adapting to Change: How Malaysia’s Workforce Can Balance Migration and Automation,"

The World Bank's recent report delves into the interplay between migration, technological change, and workforce dynamics in Malaysia...

... the report reveals that migrant workers play a largely complementary role in Malaysia’s economy. Migrant labor has filled critical gaps in labor-intensive industries, allowing higher-skilled Malaysians to focus on specialized roles that offer wage premiums...

... The report highlights that high costs and limited expertise impede widespread automation adoption, especially for small and medium-sized enterprises. Although automation is promoted as a solution to reduce dependency on migrant labor, the research finds that actual implementation is complex and context-dependent. Automation could theoretically reduce demand for low-skilled workers by taking over routine tasks. However, studies show that automation’s real impact varies: it often increases productivity, creating new labor demands in non-routine, higher-skilled tasks...

The report concludes that while automation may change the type of labor Malaysia needs, it will not eliminate the demand for migrant labor. The researchers suggest that Malaysia’s foreign worker management system should be refined to become more demand-driven, using transparent policies like tiered levies to regulate labor needs. Policymakers must prepare both Malaysian and migrant workers for a rapidly evolving job market by investing in skills training and lifelong learning opportunities. Social protection programs for informally employed workers could further protect those affected by job displacement due to automation. In a broader context, understanding public perception toward migrant workers will be key, as negative sentiment persists despite evidence of migrant labor’s positive impact on the economy.

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