Malaysia’s Brain Drain: A Crisis Waiting to Happen?

Suraj Suresh

BSc Economics(UCL)

‘The grass is always greener on the other side’ – an idiom frequently used by my teachers to express that although life in the UK might seem perfect from our side of the globe, the reality of it might be far from so. A patriot at heart, never have I thought that I would be influenced by this ‘side of the grass’, and be tempted for a life here. However, since embarking on my journey as a London undergraduate, I have been exposed to the enticing nature of the British lifestyle, the rat race of investment banking and the plethora of opportunities at my fingertips. I found myself beginning to contemplate if working abroad would be more beneficial for my personal growth as well as my career development. This mindset is the root problem of a major obstacle that our nation is currently battling, which is brain drain. 

 

What is brain drain? Brain drain happens when highly skilled workers emigrate in search of a higher standard of living, and unfortunately, Malaysia is a country that has been greatly affected by brain drain. Malaysia has a population of 32.7 million as of 2020, but the Malaysian diaspora currently plying their trade overseas stands at approximately 1.7 million. To put this in another perspective, according to a paper written by Docquier, F. and H. Rapoport, the world average rate of brain drain is about 5 per cent, while Malaysia was averaging a figure close to 10% in the year 2000. About 55% of the diaspora resides in Singapore, making up for about 44% of Singapore’s immigrant population. 

Source:https://en.wikipedia.org/wiki/Malaysian_diaspora#cite_note-ancestry2010-4

While Malaysia has a larger population of foreign workers than the diaspora, people argue that since a large percentage of the workers are low-skilled labourers, it fails to compensate for the loss of talent due to brain drain. The big question here is why are skilled Malaysians compelled to leave the country, and how does this exportation of human capital affect the potential growth of our nation?

Why the temptation to work overseas?

One of the main factors that are enticing Malaysians to reside overseas is the entire construct and structure of the job market in Malaysia that seems to favour more “traditional” jobs such as doctors, lawyers, engineers, etc. The number of students pursuing more niche degrees in university is slowly increasing; however,  Malaysia’s employment market is not ready as of yet to accommodate these degrees. As a result, professionals will now seek opportunities away from home to utilise their skill set and further develop their career.

A survey by Hayes Asia showed that 46% of the 900 Malaysian employees surveyed were dissatisfied with the low pay and benefits they received. In comparison, according to the Annual Population Survey in 2018, it was seen that 99% of employees in the UK were satisfied with their job contracts that include working hours as well as salary. To illustrate, a fresh graduate in the UK would earn, on average, roughly £30 000 while a fresh graduate in Malaysia would get approximately £5800. This figure, even after taking into account the difference in cost of living in both countries, is not an attractive one for graduates. 

Could there be potential benefits to brain drain?

While brain drain is always viewed as detrimental, there are some obvious benefits that we must discuss. The more skilled labourers there are living overseas, the more money they transfer to their families back home. This is called remittance, and it helps provide developing countries with foreign currency, finance imports and increase national income. The money remittance has also helped to lower poverty and increase the standard of living. Furthermore, new research has shown that emigration of skilled labour, at an optimal rate, can be seen as beneficial as there will be an exchange of knowledge known as ‘brain circulation’ that will lead to further growth and development. However, the situation in Malaysia is one where the number of educated individuals leaving is above optimal and the resulting loss of human capital has caused a shortage of skilled and competent workers in our country, now assets in another country. 

The government must take steps to address the issue of brain drain and can do so by carrying out several steps. First, the government should have a more progressive outlook on R&D and begin investing greatly in it. Policies that help increase the competitiveness in the labour market, thus increasing wages could solve one of the major factors of brain drain in Malaysia. The Malaysian government should also be actively scouting for fresh graduates and offer them jobs to ensure their return. However, the government cannot single-handedly resolve this issue without the help of other organisations and committees. UKEC has supported efforts in tackling brain drain via one of its primary missions to promote graduate opportunities in Malaysia. More and more skilled labourers are beginning to realise that maybe the grass isn’t always greener on the other side and that living abroad is not as perfect as it is portrayed to be. I hope that the evident evolution of the current job market and the increase in effort by the government will help curb the mass exodus of Malaysian talent.