International Migration and Development in East Asia and the Pacific by Ahmad Ahsan Manolo Abella Andrew Beath Yukon Huang Manjula Luthria Trang Van Nguyen

Author:Ahmad Ahsan, Manolo Abella, Andrew Beath, Yukon Huang, Manjula Luthria, Trang Van Nguyen
Language: eng
Format: epub
Publisher: The World Bank
Published: 2014-08-15T00:00:00+00:00

Source: Derived from Yean and Siang 2011.

An analysis of more than 2,300 manufacturing firms in Malaysia between 2000–2006 supports the previous discussion. Overall, the median labor productivity of firms that employed foreign workers was 48 percent higher than the median labor productivity of firms that did not employ foreign workers over this period. Corresponding wages were 28 percent higher (Yean and Siang 2011).

A more detailed approach to measure the impact of changes in the share of migrant workers in a firm and the impact on productivity and unit costs provides similar but more mixed results. An increase in the share of foreign workers by 1 percent results in a decline in labor productivity levels by 0.6 percent on average (column 3 of table 3.7). If the impact on productivity is broken down by occupation, change is driven by an increase in the share of foreign clerical workers (Yean and Siang 2011). On the other hand, the competitiveness of firms increases as revealed by a decline of 0.2 percent in unit labor costs. Here also, the impact differs by occupation. Declines in unit labor costs as a result of using migrant workers are larger for occupations such as technicians (by 0.5 percent) and plant and machine operators (0.4 percent).

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