IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/2053.html
   My bibliography  Save this paper

Managing foreign labor in Singapore and Malaysia : are there lessons for GCC countries?

Author

Listed:
  • Ruppert, Elizabeth

Abstract

The emerging economies of Singapore and Malaysia have labor markets with large foreign components because excess labor demand was for a long time met by foreign workers. Immigration policy to manage the inflow of expatriate labor in the two countries consists of highly regulated work permit systems that differentiate workers by nationality, skill level, and sector of activity. The associated permit fees vary across these parameters.Has immigration policy effectively managed foreign labor flows? These two countries'containment of the foreign labor force at a time of rapid, sustained growth suggest that it has. It is not enough to establish a stable macroeconomic climate with favorable investment incentives (as Kuwait has learned). In Singapore and Malaysia, complementary measures help make their immigration policies effective. Those measures include nationalization policies that limit opportunities for expatriates, institutional capacity to implement and enforce policy, a macroeconomic environment conductive to growth and job creation, and wage and employment policies that are mutually reinforcing. Trends in employment composition in both Singapore and Malaysia support the assertion that foreign labor policy effectively targets workers with skills at both extremes of the scale to fill gaps in labor demand unmet by nationals. But the news is not all good . A huge informal sector of illegal foreign workers in both countries suggests a degree of policy failure. Household survey data for Malaysia show that foreign workers earn less than their citizen counterparts. Foreign labor shares in labor markets in the Golf Cooperation Council (GCC) countries range from 50 to 90 percent of the total labor force in the context of persistent excess demand for labor concurrent with emerging unemployment among nationals. Policymakers could look to Singapore and Malaysia for lessons in managing foreign labor. But replicating Singapore's or Malaysia's immigration policies alone, without addressing existing employment and pay distortions, may have limited success, given the very different economies and institutional environments in the GCC.

Suggested Citation

  • Ruppert, Elizabeth, 1999. "Managing foreign labor in Singapore and Malaysia : are there lessons for GCC countries?," Policy Research Working Paper Series 2053, The World Bank.
  • Handle: RePEc:wbk:wbrwps:2053
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2000/02/24/000094946_99031911113873/Rendered/PDF/multi_page.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Blau, David M., 1986. "Self-employment, earnings, and mobility in Peninsular Malaysia," World Development, Elsevier, vol. 14(7), pages 839-852, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michael C. Ewers & Edward J. Malecki, 2010. "Leapfrogging Into The Knowledge Economy: Assessing The Economic Development Strategies Of The Arab Gulf States," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 101(5), pages 494-508, December.
    2. Manning, Chris, 2001. "The East Asian Economic Crisis and Labour Migration: A Set-Back for International Economic Integration?," Departmental Working Papers 2001-03, The Australian National University, Arndt-Corden Department of Economics.
    3. Chris Manning & Pradip Bhatnagar, 2004. "The Movement Of Natural Persons In Southeast Asia: How Natural?," Departmental Working Papers 2004-02, The Australian National University, Arndt-Corden Department of Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:2053. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi). General contact details of provider: http://edirc.repec.org/data/dvewbus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.