FMM president Soh Thian Lai said this policy was impractical for the manufacturing sector as industry players needed to urgently fill vacancies for skilled workers to meet demand and keep up with the Fourth Industrial Revolution (IR 4.0).
He said expats were crucial to the industry as they help bridge gaps in skills and specialised expertise, while driving innovation and providing strategic leadership.
Soh said they also ensured a transfer of knowledge to local workers while aligning production and operations with global standards, enabling Malaysian firms to compete internationally.
“The urgency to meet production demands makes it impractical to rely solely on internship programmes to bridge these gaps.
“Instead, FMM advocates for a ‘place-and-train’ system, such as apprenticeship schemes, which have proven effective in generating interest among interns for long-term careers in the manufacturing sector.
“This approach allows interns to gain hands-on experience, aligning their skills with industry requirements while addressing immediate workforce shortages,” he said in a statement.
Soh added that the process of applying for expatriate employees was already challenging enough, expressing concern that the new policy would only make it harder.
“We urge the human resources ministry to engage with the manufacturing sector to refine the intern hiring policy.”
Yesterday, the human resources ministry said the new internship policy aimed to benefit 100,000 local students from higher education institutions nationwide.
It said this would start with a pilot phase from Feb 15 to Dec 31, before taking full effect from 2026.
The ministry said for each employment pass (EP) approval through the Malaysian Expatriate Services Centre (MYXpats) and the Malaysia Digital Economy Corporation, companies would be required to provide up to three paid and structured internship placements.
Soh also urged the government to lift the freeze on hiring foreign workers and to expedite the implementation of the multi-tier levy mechanism for foreign workers.
Under this mechanism, the levy rate would be based on the number of foreign workers employed as a percentage of total employment in a company.
In unveiling the 2025 budget, Prime Minister Anwar Ibrahim had announced that the multi-tier levy system would be implemented early this year.