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Worker shortage, unattractive salaries could sputter Automotive High-Tech Valley, say industry insiders

Prime Minister Datuk Seri Ismail Sabri Yaakob will launch the Automotive High-Tech Valley at the Proton City Sports Complex in Tanjung Malim, tomorrow.

This comes following his address at the Umno General Assembly last month, where he revealed that DRB Hicom would invest RM32 billion to develop the automotive hub.

The move, according to Ismail Sabri, would generate 370,000 jobs during the development phase, and 161,000 jobs, during operations.

But, will the jobs be filled?

Earlier this month, industry players warned that Malaysia’s automotive manufacturing industry was facing a shortage of workers.

The construction industry had also been hit by the same problem. More recently, the lack of foreign workers was also obvious in restaurants and eateries throughout Kuala Lumpur and major cities.

Proton Vendor Association president, Datuk Dr Wan Mohamed Wan Embong, recently told Bernama that the national automotive manufacturing ecosystem could collapse with the loss of more than 500,000 jobs if manpower issues were not quickly resolved.

Perodua Suppliers Association president, Musa Zahidin Ahmad Zaidee, meanwhile, said the industry had trained locals, but many quit within a few months, leaving vendors in the lurch.

In response, Labour Law Reform Coalition chairman N. Gopal Kishnam, in a statement on April 6, said that employers should find out why locals were quick to throw in the towel. He described the act of hiring migrant workers as “taking the easy way out”.

Salaries, according to automotive industry insiders, remained a big issue.

“It’s in fact, a sensitive issue,” said an industry insider, who wanted to remain anonymous.

“Some companies offer contracts. Others have perks, but the base salary is just not attractive. If you are offering a local to work in the factory for an average salary of RM2,500 or RM3,000 a month, they would rather be an e-hailing rider. They can make the same amount, if not more, and they have more time for themselves.”

Another industry expert said some companies hired locals, but it was the vendors who relied on foreigners.

“It’s basically all about costs. Foreign workers are cheaper to hire, and obviously, the company would profit more, compared to if they hired locals. This is a problem across many other industries,” he said.

“But there is a shortage, without a doubt.”

Those within the industry hope the event tomorrow will see an announcement that will benefit the industry and encourage more locals to fill the positions.