Kuala lumpur: The 13th Malaysia Plan (13MP) covering 2026 to 2030 sets forth a series of labour market reforms aimed at building a more dynamic, competitive, and sustainable employment ecosystem.
According to BERNAMA News Agency, these reforms align with the MADANI Economy’s goals, focusing on increasing local participation in high-skilled, well-paid jobs while reducing reliance on foreign workers. The plan outlines a target to cut foreign worker numbers to 10% of the workforce by 2030 and further to 5% by 2035.
A key component of the plan is the implementation of the Multi-Tier Levy Mechanism (MTLM) in 2026. This mechanism will impose varying levy rates based on sector dependence on foreign workers, with the proceeds directed into a Trust Fund to foster automation and mechanisation. Additionally, the issuance of Temporary Work Visit Passes will face stricter conditions, including eligibility criteria and a shorter working year limit.
Local workforce engagement will be bolstered through initiatives like the Academy in Industry (ADI), prioritizing job placements for locals before approving foreign worker hires. “Foreign worker applications will go through a clearinghouse to ensure local workers have first priority to fill vacancies,” the document notes.
The document emphasizes the importance of adequate and comfortable accommodation facilities near workplaces to attract local workers. It outlines initiatives to encourage employers to provide such facilities and suggests reviewing relevant acts and regulations to ensure worker welfare and safety.
Furthermore, the reform focuses on harmonizing the wage system through the National Wage Consultative Council and periodic minimum wage reviews based on a living wage concept. The council’s role will expand to include setting starting salaries for graduates, including those from Technical and Vocational Education and Training (TVET), and regulating the Progressive Wage Policy (PWP).
To enhance worker well-being, new mechanisms for continuous income post-retirement will be explored, including separating Employees Provident Fund (EPF) contributions into retirement savings and monthly pensions. There will also be legislation drafted for gig workers to ensure their welfare and protection from occupational hazards.
The document reflects on the achievements of the 12th Malaysia Plan (RMK), noting improvements in the labour market, such as a reduction in unemployment to 3.2% in 2024 from 4.5% in 2020. The composition of skilled workers also increased to 30.2% in 2024, and the PWP’s full implementation in 2025 aims for 50,000 worker participants.
Efforts to improve wages have raised the monthly median salary to RM2,602 in 2023 from RM2,076 in 2020. Additionally, 20,088 participants registered for the ADI programme by 2024, and the Pembangunan Sumber Manusia Berhad’s upskilling and reskilling programmes trained 3,886,470 workers from 2021 to the previous year.