Worker shortfalls dire . . .
Shifts in labour migration patterns are causing shortages of workers in South and Southeast Asia. Despite signs of economic recovery and rising demand for goods and services for domestic consumption and exports, labour supplies from domestic and foreign sources have not met current demand. In India, manufacturing, logistics, construction, and e-commerce have been severely affected, with a 20 to 25 per cent labour shortage. Factories in Vietnam and Thailand and the palm oil industry in Malaysia are facing similar shortages, threatening to further disrupt pandemic-rattled global supply chains.
Why workers are staying away . . .
These labour shortages are being attributed to several factors, including reverse migration. In India, migrant workers are not returning to cities due to uncertain job markets and fears about COVID-19. Government-funded welfare benefits and rural development projects that create local jobs are also deterring them from moving back to urban centres. In Vietnam, many migrant workers have opted to remain close to home due to fears of infection and fatigue from pandemic response measures. In Thailand and Malaysia, where foreign migrant workers sustain manufacturing and palm oil plantations, the flow of cross-border labourers has been sluggish due to pandemic border restrictions and conflict in Myanmar.
Public and private solutions . . .
With vaccinations underway and health conditions improving, businesses and governments across the region are scrambling to get workers back into shops and onto factory floors. This includes incentives to attract migrant workers and efforts to hire locally. In India, businesses are on a local hiring spree and investing in training and skilling local youth to avoid future labour shortages. After months-long lockdowns essentially wiping out business and manufacturing, Vietnam’s government is offering migrants transportation back to the industrial heartland in the south, where companies are raising wages. Thailand’s Employment Department has stepped up recruitment fairs and employment matching efforts to fill over 400,000 vacant positions. While these labour shortages highlight the great value migrants brought to regional economies, they will also lead to global production and export delays for the upcoming holiday season.
- Business Insider: Worker shortages across Vietnam, Malaysia, and Thailand may lead to big delays in holiday shipping this year
- The Economic Times: They have not returned: How Covid-19 has impacted labour migration in the country
- Reuters: ‘We are tired’: Workers flee Vietnam’s largest city as long lockdown eases