According to the survey by the Japan External Trade Organization (Jetro), which covered some 300 Japanese companies in Malaysia, these shortages affected companies in the manufacturing and retail sectors.

“More than 60% of companies in Selangor, Johor, and Kuala Lumpur, where many companies are based, are experiencing a shortage in human resources,” it said in a statement, adding that the problem affected both large companies as well as small- and medium-enterprises (SMEs).

The survey, conducted between August and September last year, collected data from 4,982 companies across 20 countries.

According to the survey, a majority of companies said they were looking to automate because of the sophistication of production technology (78.2%), rising labour costs (73.3%) and shortage of workers 51.5%

“Nearly 60% of companies in Malaysia cited ‘difficulty securing human resources capable of handling automation technology’ as a hurdle to automation.

“Although other countries also had high response rates for this reason, Malaysia ranked the highest, indicating these companies are having a tough time hiring people with the right skills.”

Most of the respondents (60%) also said they saw no change in the employment scenario from 2022. However, 20.7% said the situation has improved.

Meanwhile, the survey also found that 50.2% of Japanese companies in Malaysia are considering expanding their business in the next one to two years.