Source of output growth in small and medium scale enterprises in Malaysia

Small and medium scale enterprises (SMEs) play an important role in the Malaysian industrial development. SMEs comprise of more than 90 per cent of the total manufacturing establishments, contributing about 40 per cent of the total employments and 30 per cent of the total fixed assets in this sector. However, SMEs’ value added is very much lower than that of the large scale. A low productivity of physical inputs or factors efficiency may be attributed to low level of value added. In general the benefit gained from technological advancement and human resource development varies for different size and types of industry. Consequently, this leads to productivity differences of their physical inputs and quality of inputs. This paper aims to address this issue using data from the Manufacturing Industries Survey conducted by the Department of Statistics of Malaysia. The analysis will look at the source of output growth in different types of SMEs sub-industries.Growth; total factor productivity; manufacturing sector

Penentuan perbezaan pendapatan buruh mengikut kemahiran dalam industri pembuatan di Malaysia

In Malaysia, the manufacturing sector has been a gradual change in its production process from utilizing a more labor intensive technique to that of more capital intensive. Consequently this change requires a change in skill composition where skilled workers are more demanded by the industries.This has resulted in changes in the wage ratio between skils, which is more favorable to skilled workers. However it is alwavs argued that wage rate do not only depend on the demand or labor. There are other factors that can influence individual income or wages. These include educational attainment,job location, and types of industries and gender. Human capital variables are hypothesized to have a positive relationship with individual labor market earnings. Individual with a high human capital attainment will be more productive; hence, higher reward is paid to them. Also a more urbanized job location and a more capital-intensive industry may offer higher wages to their workers. The more urbanized the place, cost of living becomes higher Industries also will be more competitive in getting workers as a result of high demand. Therefore, employers have to pay higher wages to the workers to cope with this phenomenon. Furthermore, a more capital-intensive industry is expected to be more productive; hence, they are capable of offering more attractive pay to their workers. This paper attempts to test these hypotheses based on a sample survey of 2065 workers in several major industries in Malaysia conducted in 1999. The determinants of labour income differentials will be identified using a regression analysis. Further, the analysis will decompose these factors into several categories to identify which factor contributes most to labour income differentials between skills

Keanjalan penggantian antara kemahiran dalam sektor pembuatan di Malaysia

It is very crucial to know the elasticity of substitution among various sectors,skills and between skills and physical capital because it will help the producers in planning their manpower. The value of the elasticity of substitution between inputs is also important to policy makers because it determines the effectiveness of the policy regarding input price change. Besides this, the elasticity of substitution provides an important guideline to the education planner. This article analyses the elasticity of substitution between physical capital and labour and between various skills, namely professionals, supervisors, skilled labour, semi-skilled labour and unskilled labour in the Malaysia manufacturing sector based on the Manufacturing Survey of 1985-1996. The constant elasticity (CES) production function is used to estimate the elasticity of substitution. The results show that the elasticity of substitution for most combination inputs is greater than unity but in general they are still low. The elasticity of substitution between high rank job categories and skills is larger than the elasticity between the low rank job categories. Also more capitalintensive industries show higher elasticity of substitution between their inputs. This reflects high rank jobs like professional and technical careers are easily substituted by other skills in the production process when their price increases. Also workers in a more capital-intensive industries are more easily substituted by each other

Indonesian Female Migrants and Employers’ Mistreatment in Malaysia: a Case of Domestic Servants from Central Java

This paper aims to investigate the main reasons why some Indonesian domestic servants are badly treated by their employers in Malaysia, and to discuss the steps taken by the Indonesian and Malaysian governments to cope with this situation. The study used a phenomenology qualitative approach with a social paradigm definition for the micro analysis. The finding show that the main reasons why the Indonesian domestic servants were badly treated were lack of communication skills and low level of competency; different culture; feudalism; bad institutional structure; and the differences in the Act between Indonesia and Malaysia. The steps taken by the Indonesian government include providing assurance to non-problematic employers for hiring the Indonesian workers, establishing a Cooperation Agency for problem solving, suggesting a one-day or one-week off to the Indonesian domestic servants or giving them compensation, resolving all problems by the Indonesian and Malaysian Cooperation Associations, and revising the Memorandum of Understanding (MoU) of the labor force. Keywords: Indonesian female migrants, migration, domestic servants, employers’, mistreatmen

Minangkabau’s Doro Tradition: Coexistence of Customary Law and Islamic Law in Caning Punishment

The present study intends to investigate the coexistence of customary law and Islamic law in doro tradition of Minangkabau Tribe. It poses three research questions as follows: (1) How is the philosophy of “Adat Basandi Syarak, Syarak Basandi Kitabullah” manifested in the doro tradition?; (2) In which ways do the customary law and Islamic law coexist in the doro tradition?; (3) How are the implications of doro tradition in the prevention of adultery vis-à-vis the principles of justice and human rights? The research used a qualitative design and gathered the data through observation and in-depth interviews. The findings show that the doro tradition refers to, and thus, accentuates the Minangkabau philosophy of “Adat Basandi Syarak, Syarak Basandi Kitabullah, Syarak Mangato Adat Mamakai”. The coexistence of customary law and Islamic law in the tradition occurs is emphasized in the implementation of caning and cumulative fines. The doro tradition is regarded as very effective as a punishment for adultery cases, as it also does not conflict with the principles of justice and human rights

Analisis kecekapan teknik dalam industri skel kecil dan sederhana di Malaysia

The Small and Medium Scale industries (SMIs) comprise more than 90% of the total number of enterprises in the manufacturing sector in Malaysia. Therefore, SMIs play a major role especially in generating employment opportunities. Technical efficiency of SMIs has a significant influence on overall technical efficiency of the manufacturing sector. Firms in SMIs are generally found to exhibit relatively low levels of technical efficiency as compared to the Large Scale Industries (LSIs) and this influence their contributions to the gross domestic product and national competitiveness. This article aims to analyse technical efficiency of 95 firms in SMIs in Malaysia using survey data conducted in 1997. The analysis uses two stage procedures. In the first stage, technical efficiency is calculated for every firm using non-parametric frontier methodology known as Data Envelopment Analysis (DEA). In this analysis, we adopt an input oriented approach at constant return to scale and variable return to scale technology. In the second stage, censored regression analysis using a Tobit model is estimated to identify the determinants of technical efficiency, that were computed in the first stage. The study found that most firms in SMIs are technically inefficient and operate at an increasing return to scale. Firm size and level of machinery utilisation have a positive significant effect on technical efficiency

Technical efficiency in transport manufacturing firms: evidence from Malaysia

This study aims to identify the level of technical efficiency and the determinants of technical inefficiency for transport manufacturing firms in Malaysia for 2010 using cross-sectional data of 130 firms acquired from the Department of Statistics (DOS). Based on the stochastic frontier analysis (SFA) approach, the results of the study reveal that the average level of technical efficiency is moderate. The estimated result identifies the important determinants of technical inefficiency which are due to employee wage rates as well as the cost of information and communication technology. The fundamental implications of this study are that transport manufacturing firms need to boost motivation among employees and strengthen the network of the production market via wage increment and communication cost

Human Capital Attainment and Performance of Small and Medium Scale Industries in Malaysia

In Malaysia, the small and medium scale industries (SMIs) comprise more than 90 percent of the total establishments in the manufacturing sector. One of the pertinent issues related to industrial development in Malaysia is less competitiveness among the SMIs as compared to the large-scale industries (LSIs). This subsequently leads to lower contribution of the SMIs to the value added of the manufacturing sector. Competitiveness is closely re-lated to human capital possession like education, training and experience among workers in an organization.  This paper attempts to examine the impact of human capital variables on SMIs’ output or value added and labor productivity. The analyses will be based on the data of 138 SMIs collected in 1997 through a field survey. The data covers six major industries in SMIs, namely, food and beverage, wood-based, rubber-based, plastic-based, metal-based and electrical electronic. In this survey workers were grouped into various levels of educa-tion to cover the non-schooling, primary, secondary and tertiary education. They were also categorized into five groups to represent professional, technical, administrative and manage-rial, supervisory and production workers. To achieve the objective of this paper, a Cobb-Douglas production function is estimated by incorporating human capital variables as inde-pendent variables in the output, value added and productivity functions. The study shows that year of schooling amongst workers, workers training and job categories have a significant positive relationship with SMIs’ output and value added growth. Capital-labor ratio and tertiary education have a positive impact on the labor productivity growth. Keywords: small and medium scale industry, human capital, labor productivit

Pengasingan pekerjaan dan perbezaan upah jantina di Malaysia

Artikel ini bertujuan untuk menganalisis perbezaan upah jantina di Malaysia berdasarkan data yang dikutip melalui kerja lapangan pada tahun 2012 di lima buah negeri, iaitu Selangor, Wilayah Persekutuan Kuala Lumpur, Johor, Kedah dan Terengganu. Sejumlah 1,274 ketua isi rumah telah dipilih bagi analisis artikel ini. Secara lebih spesifik, kajian ini memfokus kepada perbezaan upah jantina mengikut kategori pekerjaan, iaitu pekerja mahir, pekerja separa mahir dan pekerja tidak mahir. Kajian ini melibatkan dua model utama, iaitu model multinomial logit dan model upah. Di samping itu, persamaan pengasingan upah digunakan bagi menentukan peratusan sumbangan pemboleh ubah terhadap perbezaan upah jantina. Dapatan kajian menunjukkan peratus sumbangan pemboleh ubah yang terdapat dalam model upah atau dirujuk sebagai sumbangan faktor yang dapat dijelaskan adalah lebih rendah daripada sumbangan faktor yang tidak dapat dijelaskan yang dirujuk sebagai diskriminasi majikan. Di samping itu, sumbangan bias sampel yang dikaitkan dengan diskriminasi majikan dalam pengambilan pekerja yang bias terhadap wanita juga didapati penting dalam menentukan perbezaan upah jantina. Berdasarkan dapatan kajian ini, kerajaan perlu lebih tegas dalam melaksanakan undang-undang kesamaan upah yang terkandung dalam Akta Buruh negara. Bagi pihak majikan pula, mereka perlu lebih telus dalam mengambil pekerja berdasarkan merit dan bukan berdasarkan jantina

Trade Liberalization and Consumer Vulnerability: a Legal Framework on Legislations and Testing Mechanism for ASEAN Product Safety Directive

Since its inception in 1967 ASEAN has advanced in great leaps in the economic sector luring new member states into its pact. From a mere five member states (Malaysia, Indonesia, Thailand, Singapore and the Philippines) ASEAN has today managed to entice five other neighbouring states (Brunei 1984, Vietnam 1995, Laos & Myanmar 1997, Cambodia 1999) into its pact transforming itself into union of ten member states with a consumer population expected to exceed 600 million people. In order to ensure sustainability amid global challenges, member states have engrossed ASEAN Charter in 2007 with a view of creating an ASEAN Economic Community by 2015 that is robust, competitive and sustainable. At this juncture, ASEAN has to realize that like any trade liberalization initiatives, goods moved readily and freely throughout the free-trade area that is facilitated by a lucrative non-barrier tariffs incentives. This vision of a single market which creates a frontier without borders can prove to be advantageous to member states only if they have the required vehicle that is able to overcome the drawback of its progression through harmonization and synchronization efforts that is effective and successful. Like everything else, every advantage has some disadvantages attached to it. This article will address important determining factors that are crucial in the development and scope of proposed ASEAN Product Safety Directive including reviewing relevant determining factors such as regional stability, consumer protection legislations and standard and testing agencies of which one without the other will be incomplete. The proposals suggested in this article will strengthen and unite ASEAN in overcoming unsafe product issues at ASEAN level