This article first appeared in The Edge Malaysia Weekly on November 17, 2025 – November 23, 2025
Earlier this year, the Malaysian Employers Federation (MEF) called for authorities to allow asylum seekers and refugees to gain formal employment in Malaysia, joining advocacy efforts that have been going on for years. However, systemic challenges in the country have hampered any progress.
This issue has gained more attention this year, after the US halted its refugee settlement programme in January. It had received the most refugees and asylum seekers in the past.
Member of parliament for Subang Wong Chen, who has been championing the matter for years, says one conflict of interest when it comes to giving refugees the legal right to work lies in the country’s interest in importing migrant workers.
Allowing refugees to work formally in Malaysia could reduce the financial incentives received from processing migrant workers. Some are also worried this would increase the volume of refugees heading to the country.
Wong says a systemic change needs to happen and the current foreign labour system should be revised. He recommends that, with the population of documented refugees currently totalling roughly 200,000, there should be several agencies in charge of handling issues pertaining to this community, instead of handing it over to a monopolistic party.
“I would like to see this contract given to five companies in a competing manner and that the processing cost cannot be expensive. I would estimate it to be around RM5,000 per worker [relative to what Singapore charges],” says Wong.
“You cannot charge more than RM5,000 per annum or per process. You’ve then got to put in a system for insurance and for health. Once they’re registered, then they are entitled to go and seek jobs.”
“We are not giving them the right to vote; we are not giving them citizenship. We are just providing an opportunity for them to feed their family, to have a better life and, at the same time, to grow our economy. I don’t see why there should be any strong policy argument against the idea.” – Wong, Subang MP
A board member of refugee-led advocacy group ReAct, who prefers to remain anonymous for safety reasons, observes that efforts to move this agenda are always delayed.
“I feel like it’s just a kind of political narrative … Anytime an election is about to come and you see refugees all in the news again, I feel it’s just to divert people’s attention or the locals’ attention from some form of accountability,” says the ReAct board member.
She points out that Malaysia is not a signatory of the United Nations (UN) 1951 Refugee Convention or its 1967 Protocol, which means the country’s current refugee population is considered illegal and is not granted any legal protection.
Signing the convention would be an acknowledgement of the internationally recognised definition of a refugee and the proper rights and assistance a refugee is entitled to receive. This would make it easier for refugees to find employment.
Some refugees are able to apply for a UN High Commissioner for Refugees (UNHCR) card for documentation. However, the UNHCR card does not guarantee protection to refugees from all sorts of harm, as it is a document with no formal legal value in Malaysia, nor can it act as a passport, says the ReAct board member.
Even so, the process is lengthy, with some cases taking up to two years for an application to be approved. This is because detailed cross-checks are needed to ensure that not everyone is granted access into the country without reason.
The ReAct board member adds that there is a big gap between the number of refugees and the number of UNHCR workers, making it difficult for cases to be processed.
By providing refugees formal employment opportunities, it could bring a net benefit to all parties involved, she says. Refugees who are granted legal employment status will be documented and thus have their basic rights protected. The government will have a proper record of new workers, who become taxpayers.
Additionally, companies benefit by having access to people who are willing to work and there is no need to go out of the way to procure migrant workers when refugees who have been in the country for years are ready to be employed. “Having documentation means that we also have some form of security, because if anything happens, refugees are considered illegal immigrants, so we cannot make a report should accidents happen to them,” she says.
Wong has a similar perspective. He points out that providing opportunities for refugees to support themselves and their families can change public perception of the community, giving them a chance to turn their lives around.
“If there’s any criminal activity, at least we have a database to pursue all this. The most important thing is to eliminate desperation in men. Once you eliminate desperation, the refugee community will be a productive community in Malaysia,” he says.
Giving refugees the right to employment will also be upholding Malaysia’s humanitarian commitments. Refugees without access to employment can become a burden to the government, creating a lose-lose situation for people who are already living difficult lives, says Wong.
He believes that Malaysia should start taking more proactive actions to address the country’s refugee crisis and begin working more closely with the UNHCR to find a middle ground for solutions.
“We are not giving them the right to vote; we are not giving them citizenship. We are just providing an opportunity for them to feed their family, to have a better life and, at the same time, to grow our economy. I don’t see why there should be any strong policy argument against the idea,” says Wong.
“We are a developing middle-income nation. We should be able to handle our refugee matters and processes ourselves. For us to get to that level of development, doing the right thing is a sign of a more developed economy and political system, as we become more affluent and seek international recognition for the work we do.”
“The main obstacle to formalising refugee employment is political and social will to do so. Policies generally only change when the public is supportive of them.” – Melati, Asia School of Business
Net economic benefits
Malaysia’s economy also stands to gain by giving refugees and asylum seekers formal employment. The MEF cited statistics from a study by the International Labour Organization and UNHCR, which found that enabling refugees to work could increase Malaysia’s gross domestic product by up to 0.5% over time.
In addition, giving 30% to 40% of the population of refugees and asylum seekers access to the formal job market could add 55,000 to 75,000 employees to Malaysia’s labour force, which can boost productivity and support national economic growth.
Melati Nungsari, associate professor of economics at the Asia School of Business, highlights that the positive impact of formal refugee employment far outweighs the drawbacks, as claims such as a decrease in salaries for locals or competition for scarce jobs are backed by little evidence.
“The main obstacle [to formalising refugee employment] is political and social will to do so. Policies generally only change when the public is supportive of them,” she says.
She adds that the refugee population in Malaysia is very small. In comparison, the national workforce stood at about 17.23 million as at 1Q2025. This means if Malaysia legalises refugees and asylum seekers, they would represent only about 1% of the entire workforce.
“On a macro level, this will unlikely change anything about the Malaysian economy, because this population is very small. On a micro level, for the refugees, this will make a huge, almost infinite, positive impact. It will allow them to meaningfully find ways to survive and perhaps even thrive in Malaysia,” says Melati.
“It could make a very large impact on certain sectors where a small number of additional workers would make a huge improvement, such as in high-skilled jobs,” she notes.
Many people tend to make generalisations about the refugee community, not realising that some refugees were in specialised professions before fleeing their home country. Such people could potentially contribute to Malaysia’s economy and innovation in the country.
“By legalising employment for refugees overall and not forcing people into certain industries or sectors, we are allowing talented refugees to do what they were trained to do, instead of forcing, say, a Syrian doctor to work on a palm oil plantation. We could also allow a Syrian computer scientist to contribute to Malaysia’s computer science sector,” says Melati.