kheru2006 (kheru2006) wrote,
kheru2006
kheru2006

Low wages at home behind brain drain

VISITING New York recently, I met up with a former colleague who was transferred to the North American headquarters of Thomson Reuters in Manhattan seven years ago.

The man, who is in his 40s, is settling down well with his wife and two children, one of whom was born in New York. He commutes every day by train to the office from his house in New Jersey.

Sitting down for a sumptuous lunch of Thai green curry chicken and white rice, I broached the subject of whether he planned to return home to Malaysia one day. He said he was unlikely to do so. In fact, he was waiting for his daughter to sponsor his green card when she reached the legal age.

One clear reason for his decision is the compensation package. He has to take a big pay cut to return home.

The government, corporate sector and educationists must work together to make Malaysia a place where great talent, internally and externally, converge.




This is the main dilemma facing tens of thousands of Malaysian professionals working and living abroad.

Six of 10 Malaysians abroad have cited that as one of the main deterrents. The issues of liveability, and safety and security didn’t really rank high on their list of concerns.

There are, of course, “push” and “pull” factors in the whole equation of talent management.

In the first place, are salary levels in Malaysia too unattractive to attract and retain good talent?

We seem to be doing a good job in drawing low-end talent, not the high-end ones, despite our stated desire to become a high-income nation by 2020.

For far too long, our wage level has been kept artificially low by big and small employers. Just imagine, an arts graduate, who has been working for more than 10 years with one medium-sized company, is drawing just RM5,000 per month.

An engineering graduate or a young medical officer, for example, earns a starting salary of about RM3,000 per month or less.

Economists agree that wages are quite low in Malaysia. In fact, productivity growth has been higher than wage growth for the past few years.

So, to argue that we need to increase productivity before we can increase wages is not right.

What average Malaysian workers are also complaining about is that living costs are growing faster than their wage increases.

Selected items in the basket of goods, as captured by the Consumer Price Index, have registered faster price increases than the national wage increase.

We need to address the supply and demand side in ensuring that Malaysia retains and attracts high-end talent, doing higher value-added jobs, as we march towards 2020.

Part of this huge task is assigned to TalentCorp, a government agency charged with managing the talent side.

But, this is not a job for TalentCorp alone. Its chief executive, a chartered accountant by training and economics graduate from the University of Cambridge, Johan Mahmood Merican, said it had, so far, approved about 3,000 applications under its Returning Expert Programme (REP) since 2011.

It is worth noting that only the very experienced — degree holders with eight years’ experience of working abroad and earning RM20,000 per month — are covered under REP.

“I am sure others, those with less experience, are also coming back to jobs in Malaysia, but not necessarily under TalentCorp,” he told me.

Johan said the talent strategy for Malaysia was very clear: firstly, provide avenues to draw back Malaysians working abroad, and secondly, drive improvements around factors leading people to leave.

A 2011 World Bank report estimated that more than one million Malaysians (aged 25 and above) were living abroad, of which about 300,000 were estimated brain drain, as they had received tertiary education.

Things could worsen if we fail to address the brain drain issue quickly and adequately.

For example, there are some 14,000 Malaysians studying in the United Kingdom. We need to create good-paying jobs back home, otherwise, they might end up working in the UK or elsewhere.

Trained accountants and bankers from Malaysia are well sought after by global financial centres, such as London, Sydney and Hong Kong. So are our oil and gas engineers or airline pilots, who are in demand in the Middle East.

The government, corporate sector and educationists must work hand in hand to tackle education, economic and other structural reforms over the long term.

Malaysia can and should be an attractive place where great talent, internally and externally, converge and flourish, if we are really serious about this. A. Jalil Hamid NST Columnist 26 October 2014

Tags: brain
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