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The formidable challenges of human capital management faced by our country is the issue of brain drain. According to Wahab (2014), brain drain can be define as a movement of high skilled workers from less developed country to development country to find a better opportunities. In Malaysia, the most serious phenomenon of this issue is when the talents usually will leave Malaysia after finishing their education here and decide to work for other country. According to Malaysia Economic Monitor (2011), the numbers of skilled Malaysians living abroad have tripled with two out of every 10 Malaysians with tertiary education to work overseas especially to the Organization Economic Cooperation and Development (OECD) countries or Singapore. Currently, there are about one million Malaysians stayed overseas and 308, 833 of them are categorized as the highly-skilled workers (The Malaysia Insider, July 7, 2014).

The trend of brain drain results to the talents scarcity which our Government have to encounter with the waste of the high skilled workers issue. Thus, the high skilled workers are not contribute their knowledge, skills, abilities and talent for our country development yet they prefer work for another country instead because of several push factors. Some of the factors are better payment offer, better job opportunity, career development and social injustice that caused many Malaysia migrate to overseas. This issue happen in almost all sectors including marketing, production, and finance along with engineering. It was reported that the accountancy field is the most serious problem of brain drain in Malaysia (Jauhar, 2009). This problem become a concern to the Government because if they have lack of talents for the important fields, the economic growth of the country will be affected.

Thus, to take over this challenge, Malaysia Prime Minister Dato Sri Najib Tun Razak carry out his duty by introducing Malaysia Talent Corporation (TalentCorp) in 2011 to inspire the skilled and educated immigrants to go back and work in our country. The establishment of Talent Corporation as the government agency is to address with the lack of talents problem and also to lure Malaysians talents from overseas to return back in order to meet the manpower needs in Malaysia. Therefore, Talent Corporation will play the roles to identify the reasons to attract the high skilled workers consider to going back to our country and besides encourage them to generate more business prospects. It was stated that from the last 5 years, the Talent Corporation managed to bring back almost 3,600 talents back to this country. However, from year to year their task is getting tougher considering the political and economic situation of Malaysia. It is important for the Government to formulate this policy to ensure that it is align with the goal to become the high income country in 2020 can be achieved with the contribution of the skilled human capital.

On the other hand, one of the way to respond to this problem is the government of Malaysia can take initiative to invest in other potential talents in order to enlarge country’s capacity to generate skilled human capital in facilitating the use of technologies that are believe to drive knowledge economy in domestic and from foreign countries. In realizing the national goal, our country inspired to move into the Knowledge economic, they have to focus on the development of human capital by organizing many activities to attract the talents to work in Malaysia. If Government strengthen the policies related to the brain drain issue, they surely will able to seize the rising problem of brain drain in Malaysia. For example, the brain gain was the program introduced under the Ministry of Science, Technology and Innovation (MOSTI) regarding this issue. The program includes the Returning Expert Program (REP) which was introduce to encourage the Malaysian who working overseas to work in Malaysia. The other program is Residence Pass-Talent (RP-T) which to retain the expertise who already work in Malaysia.


The formidable challenges of human capital management faced by our country Malaysia to shift into high income country by 2020 is globalization issue. According to McShane and Travagoline (2007), the globalization is refer as the connection with other people from other part of the world in term of social, cultural and economic which give positive impact to country development. The term of globalization also can be define as the incorporation of the organizational activities, process and also strategic management into broader market. Thus, the globalization will directly give greater impact to the way of the country manage their human capital investment. This is because the globalization factor demand the citizen to gain higher education and always improve themselves in order compete and adapt with the international market environment. On the other hand, technological changes also provide better opportunities for the human capital in our country to enhance their skills and knowledge for the growth of the country economies.

Therefore, due to the factor of globalization, the transformation of the human resource management should be take into consideration (Kapoor, 2011). For Malaysia, the transaction to become the high income country is a big challenge since we have to pursuit on information and knowledge workers. The big challenge for this country is when some of the human capital are not ready with the rapid changes since they have improve their knowledge, skill, ability and talent with the new technology that they are not familiar with and also the are comfortable with the traditional approach. According to Paul and Townsend (1993), the baby boomers are the generation that was assumed resist to change since they are less technologically savvy and less trainable. Besides that, most of them are heading to the retirement so they do not want to pressure themselves by learning the new things or technology. It can clearly be seen that the main problem faced by our country regarding the globalization issue is the attitude of the workers itself when they are not committed to their job and still depend on traditional thinking. Furthermore, the workers usually have lack of commitment in training activities.

As we know, the globalization always be linked with the technology advancement therefore, the country need to have strong relationship internationally to increase the transfer of technology with other countries. In this globalization era, more knowledge workers are needed to adapt with the technological advancement. In line with that, the country need to recruit more skillful human capital to increase the productivity however, the challenge faced by our country to become high income country by 2020 is we have shortage of knowledge based workers. Knowledge based workers represent the workers that have skill and competencies to use the technology and accept the continuous learning. According to Saieed (2016), in order for the economy to grow, Malaysia need more skilled workers to increase the value chain to be able to compete globally. This problem likely to happen due to the mismatches, insufficiencies of education system and low participation from women in the workforce. Because of the reasons, Malaysia are now suffers from lack of skilled workers, weak productivity growth, lack of workforce’s creativity and innovation and over dependent on foreign workers which only require low-wage.

The best way on how to respond with this challenges is first of all, the Government have to find a way on how to change the mindset and the attitude of the workers by provide motivation and reward for their performance. This will help to make them understand the vision of the country to become the high income country by 2020. Therefore, through empowerment, the people will take responsibilities to improve themselves and will able to encourage them to play active role and willing to change according to national goals. On the other hand, the effort can be taken by Government of Malaysia is to improve communication by strengthen their relationship with other counties so that we will not be stuck in a middle income country trap. The effort from the Government can be seen through the bi-lateral relationship with China and multilateral relationship by joining the ASEAN community. The ASEAN community also priorities on the development of human capital in which they encourage to extend the mobility of the workers to gain the skills and knowledge and contribute to country development.

Besides that, the government can take the initiative by investing in education, training and research and development (R&D) to enhance the human capital development and produce more skilled workers. For example, we can take the developed countries such as US, Japan and South Korea success as our benchmark which they put high commitment to invest on education, training and R&D to develop the manpower in all sectors. Government of Malaysia need to take this investment as a long term goal align with the national goal to become high income country by 2020.Apart from that, the Government also have to collaborate with the private company and universities so that all the parties can gain the benefits from it and able deal with the challenges through the research and development. Thus, it would encourage the global shift of knowledge economy by increasing the competitive advantage of the country.


Jauhar, J., Yusoff, Y., & Khoo, M. Y. (2009, January 1). Factors that Drive Brain Drain of Accountants in Malaysia. Proceedings of the International Conference on Intellectual Capital, Knowledge Management & Organizational Learning.

Kapoor, B. (2011). Impact of globalization on human resource management.

Malaysia Economic Monitor. 2011. Brain drain. Retrieved from

 McShane, S., & Travaglione, A. (2007). Organisational behaviour on the Pacific Rim. McGraw-Hill Higher Education.

Paul, R. J., & Townsend, J. B. (1993). Managing the older worker—don\'t just rinse away the gray. The Academy of Management Executive, 7(3), 67-74.

Saieed, Z. (2016, November 26). Malaysia Skilled Labour Shortage. The Star Online. Retrieved from

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