MPOA: Revenue losses from labour shortage at RM20bil

The MPOA survey provides an overall picture of the current labour shortage in the plantation sector, says chief executive Joseph Tek Choon Yee.

PETALING JAYA: The Malaysian Palm Oil Association (MPOA) is continuing its efforts to engage the Malaysian government, currently headed by Datuk Seri Anwar Ibrahim, to resolve the chronic labour shortage issue that has been plaguing the palm oil industry, especially since the onset of the lockdowns in 2020.

MPOA chief executive Joseph Tek Choon Yee, speaking at the association’s National Labour Forum (NLF) 2022 yesterday, pointed out that revenue losses due to the shortage of oil palm harvesters is estimated to be about RM20bil.

Additionally, Tek said a survey on foreign workers has been carried out by MPOA – which derived data from its top 10 planter members from January to November this year – covering the recruitment and entry of foreign workers into Peninsular Malaysia for the plantation sector.

“The survey summarised that as of Nov 30, 14,159 foreign workers have been recruited and entered the country. There were 6,837 of these workers for the plantation sector that came from Indonesia, another 6,532 entered the country from India, 730 were from Nepal and 60 were from Bangladesh.

“While this represents 49% of the 28,724 foreign workers that were approved by the authorities, it is only 19% of the total foreign workers required for 2022, which is 74,664,” he revealed.

The planter members of the MPOA include heavyweights such as IOI Corp Bhd, Sime Darby Plantation Bhd, Genting Plantations Bhd and Kuala Lumpur Kepong Bhd.

Tek commented that the survey provides an overall indicator representing the current labour shortage situation of the plantation sector, as the number of foreign workers entering Malaysia are still far from an earlier estimate of over 120,000 workers required to address the present shortage of workers in the oil palm plantation sector.

“It is still a long journey. Bear in mind that there are still other sectors facing the same problem,” he said.

The previous government, under its Budget 2023 that was tabled in early October, had intended to implement a multi-tier levy system on the number of foreign employees a company employs in its effort to encourage mechanisation and the hiring of locals.

However, Tek reiterated the idea that mechanisation is not a “one-size-fits-all” initiative.

He added that since palm oil requires a comparatively low labour rate compared to other types of crops, it is still facing the labour shortage problem. The country would “sink or swim” with palm oil as there are no other types of plantations to fall back on.

The NLF 2022 was attended by over 200 participants including MPOA members, invitees from the industry and stakeholder speakers from various government agencies, as well as other service providers involved in the recruitment and return of foreign workers to Malaysia and human resource requirements for the plantation sector.

The question-and-answer sessions following the update briefings also featured questions from participants on several labour issues including workplace forced labour and Malaysia’s current Tier 3 status on human trafficking.

Article type: free
User access status:
Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!


Next In Business News

Exciting deals at Sunway Theme Parks Mega Roadshow
CPO futures likely to trade in yo-yo mode next week
Maybe Apple’s weakness isn’t just supply chain woes
Good news for the global economy
BP, Chubu Power to study CCS project at Nagoya
Short Position: Private equity exits, Managing cyber threats, Don’t kick the can down the road
Bonds surge as traders call time on hikes
Central banks continue fight against inflation
Defining market manipulation
Lee Chun Fai redesignated as IJM CEO and MD

Others Also Read