A workforce value chain analysis in high tech multinational corporations' electronics manufacturing in Penang
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Date
2010
Authors
Lay Hoon, See
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Abstract
Penang has been a hub for multinational companies (MNCs') in Asia since the 1970s
(Malaysian Business, 2004). High-technology companies quickly recognised Penang as the
hotbed for their offshore investment due to the vast pool of technical talents and low-cost
structures, and thus provides an excellent environment for illl1ovation.
Penang, as the thriving technology hub for more than 30 years, is highly aware that the
workforce dependency to foreign direct investment (FDI) is tremendous. Since the beginning
of January 2009, many foreign owned MNCs' had laid off their workers due to the economic
recession, which hit the American economy badly. The escalated unemployment rate is a
lagging indicator, which often starts to rise only after economic trouble starts mounting. As
such, how can we possibly stabilise the employment rate and the workforce in totality without
fully depending upon the FDI host countries' economic fluctuation? KMPG Business
Advisor, Woon Tai, and the Malaysian American Electronics Industry's chairman, Datuk
Wong Siew Hai echoed that the employment stability in FDI especially the electronics and
electrical (E&E) companies are expected to expand and move up the workforce value chain.
The present research aims to explore the depth in the pioneer MNC investment
company and to investigate on workforce value chain for sustainability and survival.
Influence from the MNCs' investment is analysed, and evaluated if it exert strong economic
and political push for a workforce structural reform. Another exploratory area is on whether
the externalities generated by the FDI have positive effects to create enough urgency to the
Malaysia government for human capital policy change either in education or in others.