No stopping talent from heading south

WE have known for the longest time that Singapore has been a magnet for Malaysian talent, and it does not look like the brain drain is going to stop anytime soon.

Recently, news broke that Singapore is poaching our soon-to-graduate medical doctors by offering them an annual salary of S$110,000. That works out to over S$9,000 (RM27,990) a month.

That is just the starting salary and even on a one-to-one basis in ringgit terms, that is way more than what Malaysia is offering.

And you can bet Singapore is pinching those from the top of the class.

And then, there are the nurses it is taking away from Malaysia, among the many other professions it has lured. We can gripe and complain, but that will not stop the conveyor belt of talent heading south.

In some way, Malaysia is to be blamed for the medical personnel crisis. From the narrative that there were far too many doctors being trained in the country to there being too few doctors now, this is in someway the fault of government planning.

And to make matters worse, it has been reported that just over 500 medical students had accepted housemanship positions from some 5,000 available slots. That is abysmal planning by the authorities.

Singapore pinching our talent has been a perpetual issue. Most of us will know of someone who has emigrated to Singapore for a job or business opportunity, and prospered as the country had done.

Another uncomfortable fact is Malaysian talent helped build Singapore to what it is today.

Singapore offers a higher salary, lower taxes and a strong currency that is a huge attraction for Malaysian employees.

Singapore is not the only barometer, but a large component of the brain drain from Malaysia. It is estimated that around 5.5% of Malaysia’s population has left its shores for better opportunities elsewhere compared with the global average of around 3.5%.

And Singapore accounts for around 60% of the Malaysian diaspora, taking full advantage of the proximity, culture, language and food that are shared between both countries.

A large number of them are skilled workers, which is estimated at between 60% and 70% of skilled emigrants. Those who call Singapore home is Malaysia’s loss.

Hundreds of thousands commute daily to Singapore for work, using the Causeway and the Second Link to traverse between both countries.

The number of Malaysians who have left for greener pastures overseas pales in comparison to the around 250 Talent Corp brings back home every year.

What Malaysians gain from working in Singapore, especially for the daily commuters to factories there, is remittances. This is the same for foreign workers in Malaysia who send back money to their home country. It’s just that the scale is different.

And the talent train is set to continue. I would suspect the reason why Singapore was agreeable to building the Rapid Transit System or RTS between Johor Baru (JB) and Woodlands in Singapore is to ferry talent from Malaysia, and also as an escape valve for the high prices of property there. That should make rent and property prices in JB more expensive.

JB will house talent who will be working in Singapore and contributing to the continued development of the island republic.

One estimate has the loss of Malaysian talent to Singapore at RM1.3 trillion over the past 50 years, and economically, this loss has shaven off Malaysia’s economic growth.

The high-level talent who are now pursuing opportunities abroad will eat into Malaysia’s strategy of becoming a high-income economy.

The lack of sufficient high-income jobs in Malaysia is luring talent to Singapore and our southern neighbour does take advantage of such talent by offering them room for research and development (R&D) and higher specialised jobs.

As Singapore’s demographics present a challenge to the island republic, it can be rest assured that Malaysian talent, who share cultural similarities, will continue to make themselves available to job opportunities there.

Singapore continues to attract large amounts of foreign capital for job-hungry investments as most of it is in finance and insurance.

What then can Malaysia do?

The authorities should concentrate on building a business base that requires the requisite talent. Energising R&D can be a way to retain talent too.

Focusing on higher value-added jobs and skills by bringing in the right investments, instead of high paying but job-scarce data centres, can help.

There has been news of some exodus of businesses from Singapore to Malaysia, which primarily would mean such businesses are taking advantage of the lower cost base in Malaysia.

That is not a long-term strategy in building a sustainable business environment for higher-skill and better-paying jobs in the country.

There has to be an organic shift into that area with a strong emphasis on higher-value added businesses and investments.