Malaysia Digital growth - the role of Expats
There’s absolutely no doubt, the balancing act between local and expat talent is difficult to get right and needs continual evaluation.
On the one hand, the priority of any country is to support opportunities for its own people and get its own people into roles to ensure continued upskilling and best utilization of existing talent. The challenge is when dealing with emerging specialist skill areas, where existing talent doesn’t meet demand. This is compounded by the fact employers want the right talent immediately and don’t tend to compromise, because often, they can’t afford to be based on the nature of their deliverables. Granted it’s up to companies to invest in talent at grass roots, hire transferable skills and drive continuous improvement initiatives to keep existing staff up to the minute with emerging skill areas. However this isn’t happening intensively enough currently to ensure the right talent is available where it’s needed via these channels alone for the foreseeable.
Malaysia has the advantage of being an increasingly attractive expat destination for skilled professionals due to, at least till very recently, relative visa friendliness and business friendliness, plug and play approach, ‘livability’ and quality of life. This reputation was building, though my concern is a reversal of some of these factors, no doubt influenced by the self protecting impact of COVID. This could be counter productive to the long term employment prospects of locals themselves if employers take their business elsewhere due to talent shortages.
The inevitable result is a widening skill gap between supply and demand, which is not good for sustained economic growth and will lead to a failure to meet objectives of becoming a global digital hub. The skilled expat option needs to remain a clear option for Malaysia if it is to reach its ambitious goals of building itself as a hub for innovation. The upshot will be that the build phase of innovative digital products will shift to other parts of ASEAN such as Vietnam, which is fast establishing itself as a go-to destination for software development.
If countries need to tighten its control on expat numbers, it needs to be means based. If there are areas where it’s relatively easy to upskill locals versus bringing in expats, then this is more manageable. In new areas, or where it's highly specialized and needs people with extensive training and track record, like software engineering, then a different approach is needed. Malaysia is competing on an international stage and the talent flow needs to be fluid. There are hardly any destinations globally where software engineering talent is entirely home grown and this even includes Silicon Valley. Malaysia cannot risk attempting to make itself the exception, especially as the local talent pool does not meet demand as it stands. The raw talent fueled by aspiration is available, though the essential nurturing process would take years to tune talent to the level it’s needed for projected demand. Furthermore who provides the necessary training and expertise to raise the bar to where it needs to be? This is where the skilled expat plays such a critical role; to fill immediate gaps and support skills transition for the longer term interests of the host country.
The targeted visa model for skilled professionals is an approach being adopted in many high growth destinations such as Singapore. The new Tech Pass Visa, which has just been launched is a great example, where applicants need to meet criteria around capability, though once met it’s a fast track and robust model for facilitation of the right talent exactly where it’s needed. This will come as a boon for existing digital employers and those global businesses seeking to evaluate a destination point for its APAC hub as 500 visas of this nature have been allocated for the first round, which will have a profound impact on the Singapore digital talent ecosystem.
Emerging ambitious Asian tigers like Malaysia have prided themselves for many years on being an attractive destination point for companies looking to build and innovate in areas like Technology and Digital. One of the clear points for evaluation is quality and capability of local talent to meet demand and this has to include ability to fill gaps and upskill existing sources by leveraging skilled expats from global sources of expertise. This was always a relatively strong suit for Malaysia, though I am concerned this is being compromised by the combined impact of a more protectionist approach and lack of innovation around targeted models for visa facilitation in areas where it’s most needed in line with growth targets.
This final irony is that the very people the policy makers seek to protect become compromised as businesses and innovators take their core activities elsewhere to fulfil demand. This is a massive shame as Malaysia has the potential to meet demand with local talent with the right nurturing, training and support from the international community.