Links Between International Factor Flows and Labor Standards in Malaysia: Findings from a Stakeholder Survey

Abstract

This article identifies the dilution of key aspects of labor standards and establishes their systematic links with the global integration of the Malaysian economy through capital and labor inflows. The approach taken in this article is that investors and migrants, may, serve as channels of (lower) labor rights. For this purpose, the study consolidates information through interviews conducted with trade unions, activist groups and non-governmental organizations. The findings suggest that migrants have influenced and lowered the labor rights for the unskilled group. Since migrants have little information about their rights, they are directed into the secondary labor market with insecure and exploitative jobs. They have therefore become a preferred source of employment, “naturally” relegating the unskilled locals into contractual jobs with minimal to no work entitlements.