Re-Pricing of the workforce.

A friend of mine, a young penghulu is an avid footballer. He has his own team that plays in the local league. His team is on top of group A of several groups. His next opponents will be the team from UIA in Kuantan. The team is made up of mostly medical students studying here at the UIA Kuantan campus.

That would be a cinch, said I. Not so, said the penghulu. How come, I countered? These med students are all nerds and won't have the energy to play you people. Maybe ramai kaki bangku je.

Yes, said the penghulu. But what they lacked in physique and stamina is amply compensated by what they have between their ears. I am sure he meant their brains and not their noses. We always have a tough time playing a team comprising of intelligent people. They play a game that's not easily overcome. We are the ones at the end of the game, gasping for breadth.

So how do you lick them? We use scare and intimidating tactics. Early in the game, we will take out one or two of their players. So as the game goes on, the UIA boys are scared to come into contact with the ball.

Interesting, I observed. A team comprising of intelligent people can win over brawny people. What if, the team with intelligent players are superbly trained in physical prowess; they can be a winnable team all the time.

How do you do that? By re-pricing players. This means, you attach a higher premium to players with better skills and better intelligence. As the game evolves to higher standards, we need more quality players.

It's the same with the game of economics. What are the policies this administration has to enhance the capabilities of our workforce? They can do this, by re-pricing the workforce. They do this by attaching higher premiums to those workers with better and higher valued added skills. They do this by adopting policies that turn our workforce into a winning team. They must, in order to turn Malaysia into a winnable economy.

What kind of team you want to play at the economic game? If you prefer to have a team that relies mainly on brawn, you will be out competed with a team consisting of brawns with brains. It will depend on your vested interests and the policies you apply to operate the vested interests.

A country's output depends among others, on the quality of the workforce. To ensure you have a workforce that can produce efficiently when combined with other economic resources, you will require workforce with enhancing capacities. You put a dud to work with a state of the art contraption, that million Ringgit machinery is wasted.

This means, workers will have to be invested with skills. The workforce will have to be trained, re-trained. More progressive elements of the workforce will make the necessary positioning of themselves. The whole idea is to make themselves relevant to the emerging needs of the market.

Those accustomed with the business as usual approach, ensconced in their own comfort zones are likely to be placed outside of the economic game. If they are trapped in their own myopic obstinacy, they will be reduced to the workforce capable of handling only the low value added economic activities. In the long run, this short-sighted attitude will create social upheavals because the stubborn workforce will be earning less that those who make the transition.

This is where the policies of the government will be tested. How will they cope with the demands of the economy for changing workforce profiles? Those with better skills will replace those who refuse to re-skill themselves. In our country, the problem is made even more complicated when those ill equipped and under skilled belong to a particular ethnic group.

The pants off the seat approach are likely to put in place policies that protect the job market. The sad part is, the protection comes in the form of legislation, fiat, decree that say, the workforce in any industry must be made of a certain legally sanctioned number. In the longer run, the adoption of these protectionist policies will have deleterious effects on the economy as a whole.

How to address the issue? In particular, the Malay workforce must re-tune themselves- acquire skills and new knowledge, position themselves as relevant inputs into the economy. Take note that if globalisation in effect turns the market for human labour into one gigantic market place, where movements in and out of countries will be a thing of the past, local job market too, will be similarly affected. Globalisation of the world workforce market makes security of jobs fragile. For example, those engineers and scientists who once thought their jobs are secure now face competition from newly minted scientists and engineers graduating from China and India in large numbers.

Chinese and Indian scientists and engineers willing to take lower pay will be knocking at the gates of the American economy. If the Americans refuse to re-price themselves not only in terms of willing to accept rationalised pay packets, but also refuse to upgrade themselves, they will be replaced.

There are lessons that can be learnt from globalisation of world workforce. In Malaysia, colleges and universities are producing more capable non-Malay workforce in larger number than Malay workforce. If the quality of the Malay workforce is less amenable to demands of the market, they will be sidelined. That will happen not because they are not graduates but are graduates in disciplines which are les marketable.

Will the Malaysian government, under the administration of Dato Sri Najib who is desirous of making his mark as quickly as he can, liberalise the workforce market as he did the service and finance industries? That will mean, that jobs held by those who refuse to upgrade or who think they are employable by taking any disciplines will be threatened.

Once threatened and those adversely affected will apply intense political pressures on Dato Najib's administration. This will force the government to try to protect jobs often at long-term cost to their economies.

The Najib administration will have to re look at the workforce policies. Perhaps it was with this view, that Dato Najib has reworked the 30% requirement in equity holdings and with that, the unavoidable re-profiling of the workforce.

If Dato Najib plays ball with pressures to lock up the workforce, the ultimate victim will be our productivity. Let me hasten to add quickly to state that the lowered productivity is not caused by the participation of the Malay workforce. It becomes slowed because the Malays have not, to use a term gaining fast currency, undertaken a re-pricing of their employability. Refusal to cultivate oneself with more marketable skills and knowledge will place them outside the economic game. Forcing the government lock up the workforce market will blunt our competitiveness and in the end, the country's productivity.