The Recruitment of Foreign Labour in Malaysia: From Migration System to Guest Worker Regime

In 1997, when the Asian Financial Crisis struck the high-gear economy of Malaysia, it precipitated, among other measures, a major repatriation of the foreign labour force, both legal and illegal, in the country (see Battistella and Asis 1999). Registered foreign workers at that time numbered an estimated 1,471, 645 and the number of undocumented workers was anybody’s guess, although a ratio of 1:1 was often cited (New Straits Times, 27 June 2001). The measures were effective. By the year 2000, the number of legal workers had declined sharply to an estimated 740,000, with another estimated 400,000 in the country illegally (Mingguan Malaysia, 27 January 2002). Since then however, numbers have picked up again. Today, five years after the crisis, and with the economy still struggling to get back on its feet, the foreign share (legal) of the Malaysian labour market has almost fully recovered to pre-crisis levels — at 1.2 million (New Straits Times, 14 October 2003).