PETALING JAYA: Companies need to adopt Industrial Revolution 4.0 (IR4.0) to reduce dependence on foreign workers due to difficulty in hiring them.

Malaysian Employers Federation president Datuk Dr Syed Hussain Syed Husman said employers need to change their mindsets and embrace new technology under IR4.0.

He said some sectors rely heavily on foreign labour for low-skilled jobs in the manufacturing, plantation, construction and service sectors.

“IR4.0 presents new challenges to all sectors. They are required to make changes in line with the digital transformation of their operations to remain agile and competitive.”

He added that IR4.0 innovations were penetrating every industry from electronics, automotive and garment manufacturing to business processes, logistics, finance, insurance and healthcare.

Syed Hussain said with 2035 being the deadline for IR4.0 implementation, Malaysia introduced Industry4WRD to assess the readiness of the manufacturing and related services sector, adding that under Industry4WRD, the government provides incentives to help transform the manufacturing industry to be smarter, more systematic and resilient for migration to IR4.0.

“The benefits derived from technological improvements include efficiency, productivity, speed and agility. These innovations could make products safer, increase industrial productivity and shorten global supply chains.”

He also said IR4.0 could resolve common issues related to manpower, machine, material, marketing intelligence and data trends.

“Workers need to acquire different and or new skill sets to stay relevant and employable. Employers on the other hand, have to prepare their workforce and ensure they have the necessary skills and competency to advance the country’s economic transformation agenda for IR4.0.

“SME technology adoption remains low and utilisation of computers is limited to administrative matters. A study by SME Corp revealed that 79.7% of SME entrepreneurs realise the importance of using digital technology for key business operations, albeit at low utilisation levels.

“The utilisation of digital technologies such as Customer Relationship Management and Enterprise Resource Planning is still low, at 12.5% and 10.5% respectively.”

Syed Hussain said the challenges faced by SME in digitalisation include the lack of understanding of digital tools usage, technical knowledge, awareness of financing options and limited access to technology in addition to facing a shortage of the required skills, talent and knowledge to adopt IR4.0.

Federation of Malaysian Manufacturers president Tan Sri Soh Thian Lai said IR4.0, via the implementation of automation and the adoption of technology, can reduce the number of foreign workers required.

He said it would lead to enhanced productivity and the growth of skilled talent as industries move to more highly skilled workers.

“It must be recognised that not all processes can be automated, and thus industries would have to identify the specific processes in their production lines that can be improved through IR4.0.

“The adoption of IR4.0 in the manufacturing sector is moderate. Nearly 1,200 SME participated in the Industry4WRD Readiness Assessment programme. Among the top three sub-sectors involved in IR4.0 are food products, rubber and plastic products and fabricated metal products.

“The adoption of IR4.0 will help industries overcome the ongoing labour shortage problem. Moving forward with it will present new skill sets sought by industries. It is very critical for the country to continue to expand and improve its supply of technically skilled workforce through Technical and Vocational Education and Training programmes,” Soh added.