Commentaries on a coherent foreign labour policy have again emerged in the last few weeks. The common consensus is that Malaysia does require foreign workers, but there needs to be a holistic policy that has certainty to enable planning by employers. It should also be consistent as flip-flops are costly to businesses. The policy should be for the longer term to ensure labour supports sustainable economic growth. Recent measures on foreign labour, especially for unskilled workers, have been ad
hoc. Protests by employers against the uncertainty of implementation have led to the policy measures being announced and then deferred. The substantial growth of foreign unskilled labour has raised concerns that it would lead to a low-wage culture and a low purchasing power syndrome, which has longer-term implications on gross domestic product growth. Studies also show that foreign labour is only positive for long-term economic growth when the labour force is educated and skilled. When foreign labour is skilled, it complements the local labour. When foreign labour is unskilled, it tends to substitute the local labour.