The migrant segment in Malaysia has been growing fast over the recent years with a massive influx of foreign workers from neighboring countries due to the growing pace of the nation’s economic landscape. While population growth and ease of travel have prompted many workers in developing countries to seek work elsewhere, developed countries have also increased their demand for labour, especially unskilled labour.
Nielsen’s latest syndicated study on migrant workers in Malaysia revealed that most migrant workers in Malaysia are at the pinnacle of their youth and many leave their family back home in search of a better life for themselves and their families. The Nielsen Migrant Syndicated Study was conducted from July-September 2015 and surveyed over 1,000 migrant workers from Indonesia, Myanmar, Philippines, Bangladesh and Nepal.
According to the Nielsen study, most migrant workers have stayed in Malaysia for at least five years and are planning to continue their stay for another five years or longer. While the working hours may be long with an average of 10 hours a day, 85% of the respondents have said that they enjoy their life in Malaysia and the nation is increasingly becoming a second home away from home.
While the migrant’s home country will always remain an integral part of their lives, nearly two thirds of the respondents have indicated that they will send their earnings back home at least once a month (65%). Migrant workers from Indonesia (73%) top the list followed by those from Bangladesh (69%), Myanmar (62%), Philippines (61%) and Nepal (61%).
And when it comes to the various channels to remit monies back home, about a third of the respondents uses third party remittance provider such as the International Money Express (34%), Western Union (29%), and Merchantrade (11%). More than six in 10 of the respondents state that the simple process (67%) and minimum fee charge (63%) are the key criteria in deciding which remittance provider to choose in sending their earnings back home.
“Generally, migrant workers have many worries when it comes to monetary transaction to their family back in their home country. Some are fearful that they may not have the appropriate official documentation to carry out transaction while others are fearful of their monies being stolen while it’s kept at home. This is where financial institutions and third party remittance can close the gap by effectively communicating their institution or services’ reliability and security features.” observes Elahi.
“These security fears may be one of the key reasons why many migrant workers are more prone to conducting monetary transaction via third party remittance then doing it via the official channels as they are worried that their hard earn money may not reach their intended recipient or destination."
92% of respondents owned a mobile phone in which three in five of them owns a smart phone (61%). More than seven in 10 respondents say the main reason they own a mobile phone is to enable them to stay connected with their family (78%). Other electronic devices and gadgets that migrant workers also own while in Malaysia include television (61%), DVD player (27%) and digital/video camera (4%).
Although voice and short messaging services (SMS) continue to dominate the main activity users use their mobile and smartphone, more than two thirds of those who own a smartphone is also utilizing chat apps (73%) and social networking sites (64%) to stay connected.
“As most migrant workers do not own a laptop or desktop computer or tablet, the mobile phone is the closest friend that they have while in Malaysia. This simple and most of the time, smart gadget helps them to stay connected with their loved ones and friends,” observes Monjur Elahi. “Besides connectivity, for migrant workers who own smartphones, they are also increasingly relying on the device’s multimedia features listen to music, play games and watch mobile TV since most of them do not own any other smart devices.”
The Nielsen study also reveals a unique spending pattern among migrant workers in Malaysia. On average, an individual migrant worker has less purchasing power than the average Malaysian consumer. However, the migrants’ pattern of consumption also stood out; rather than purchasing their daily necessities in large quantities, over six in 10 migrants prefer to purchase goods that are in small size packages (66%) and will also purchase as and when needed (68%) rather than keeping goods in large stock pile (32%).
This unique purchasing behaviour is not just exclusive to daily necessities but also when they top-up their prepaid mobile lines. Half of the respondents top up between RM6.00 and RM10.00 (50%) at any one point in time while only a third would top up more than RM20.00 at any given point of time (32%).
According to the World Bank*, a 10% net increase in low-skilled migrant workers may increase Malaysia’s GDP by 1.1%. Unskilled foreign workers in Malaysia supports the economy by allowing businesses to keep costs down and thus allowing employers to further expand and employ more local skilled workers. The World Bank report further states that for every 10 new immigrant workers, up to five new jobs may be created for Malaysians.
“With the increasing significance of migrants in Malaysia’s economy, consumers in this migrant group will be looking for products and services which can cater to their unique lifestyle and consumption habits. Therefore, a clear strategy to win the hearts and minds of this group of invincible consumers is essential should businesses want to target the migrant segment such as placing an emphasize on the essence of the migrant’s home country, ranging from food to music, movies, news and language used.” said Elahi.