publication . Preprint . 2014

Economic implications of ASEAN integration for Malaysia's labour market

Rasiah, Rajah;
Open Access
  • Published: 01 Jan 2014
Abstract
This paper examines the implications of the formation of the Association of Southeast Asian Nations (ASEAN) Economic Community (AEC) in 2015 on Malaysia’s labour market. The discussion centres on the nature of the structural change that Malaysia has experienced, especially since the 1980s, and how that has impacted on its labour market. Integration into ASEAN markets has obviously helped Malaysia enjoy the synergies of regional coordination. Although Malaysia’s economic growth has been steady, the onset of deindustrialization before a shift to higher value-added activities has impacted somewhat negatively on per capita income growth rates since 2000. Although it...
Subjects
free text keywords: labour market, economic implication, economic integration, regional cooperation, interindustry shift, Malaysia, ASEAN countries, marché du travail, conséquences économiques, intégration économique, coopération régionale, mutation interindustrielle, Malaisie, pays de l'ANASE, mercado de trabajo, consecuencias económicas, integración económica, cooperación regional, desplazamiento industrial, Malasia, países del ASEAN
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2. Malaysia's integration into ASEAN……………………………………………………………................3 2.1 Trade liberalization…………………………………………………………………………..……….3 2.2 Finance and banking…………………………………………………………………………………. 4 2.3 Investment coordination……………………………………………………………………...……….4 2.4 Coordination of primary sectors……………………………………………………………................5 2.5 Transportation and communications………………………………………………………………….5 2.6 Services……………………………………………………………………………………………….5 2.7 Intellectual property rights…………………………………………………………………...……….6 2.8 Private sector programmes…………………………………………………………………...……….6

3. Theoretical considerations………………………………………………………………………...............7

4. Structural change: Industrialization and deindustrialization……………………………………...……...10

5. Impact on the labour market……………………………………………………………………..............17 5.1 Employment…………………………………………………………………………………………17 5.2 Labour force participation rates……………………………………………………………………..18 5.3 Labour productivity…………………………………………………………………………..……...19 5.4 Real wages…………………………………………………………………………………...............21 5.5 Gender segregation and discrimination……………………………………………………………...22 5.6 Foreign labour………………………………………………………………………………..……...25 5.7 Unemployment and inflation………………………………………………………………... ……...28

6. Conclusions and implications……………………………………………………………………............30

1. Sector GDP growth, Malaysia, 1990-2010……………………………………………………………...11

2. Structure of GDP, Malaysia, 1970-2010 (%)…………………………………………………….……..11

3. Sector employment structure, Malaysia, 1970-2010 (%)………………………………………...……..12

4. Sector export structure, Malaysia, 1970-2010 (%)……………………………………………….……..12

5. Foreign equity ownership, manufacturing, Malaysia, 1968-2010 (%)…………………………...……..13

6. Manufacturing value added growth, Malaysia, 1979-2010 (%)………………………………….……..14

7. Manufacturing trade balance, Malaysia, 1979-2012……………………………………………..……..15

8. Composition of manufacturing export, Malaysia, 1979-2012…………………………………..............16

9. Annual average growth of employment, 1988-2010 (%)……………………………………….............18

10. Labour force participation rates and unemployment, by sex, Malaysia, 1982-2011………….............19

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