Brain Drain in Southeast Asia: The Case of Malaysia and Indonesia

In recent years, Southeast Asia has experienced a considerable loss of skilled and talented individuals. Brain drain not only impacts the individuals who leave, but also poses a significant threat to the economic development of the countries they emigrate from.

In this article, we will take a closer look at how brain drain has affected two countries in the region, Malaysia and Indonesia, and delve into the underlying causes and far-reaching consequences of this trend.

Malaysia's Brain Drain Rate

The World Bank's Global Bilateral Migration Database reveals a worrying trend of an increasing percentage of highly skilled individuals leaving Southeast Asian countries, with Malaysia being one of the most affected. Its brain drain rate stands at 5.5% of the population, significantly higher than the global average of 3.3%. When Malaysians seek better career opportunities abroad, Singapore emerges as their top destination, followed by Australia and the United States. It is also noteworthy that the Department of Statistics Malaysia recognizes Singapore as the most preferred country for Malaysian emigrants.

Indonesia's Brain Drain Rate

Indonesia is also facing a brain drain problem. According to RGF International Recruitment’s Talent in Asia 2019 Report, an overwhelming majority (38%) of Indonesians would choose to relocate to Singapore above any other country. If not Singapore, Indonesians would consider a move to Europe (13%) and Malaysia (7%). Brain drain from Indonesia is particularly significant in the field of science and technology. The country struggles to keep its best and brightest individuals, who are often enticed by better opportunities in other countries.

Causes of Brain Drain

The causes of brain drain in Malaysia and Indonesia are complex and multifaceted. One of the primary causes in Malaysia is the lack of meritocracy in the workplace. Many Malaysians feel that social connections are necessary for career progression, and that merit is not given enough weight in employment decisions. As a result, individuals who feel they have hit a career ceiling will often choose to leave the country in search of better opportunities elsewhere.

In Indonesia, the cause of brain drain is often related to the need to master a specific field of study. Many Indonesians who want to stay true to their expertise and master a specific field of study must leave the country to do so. This is often because those skills are not in demand in Indonesia. In some cases, brain drain also occurs due to low salary rates. According to Bank Negara Malaysia, Malaysians are not being paid enough for the level of productivity they are producing, with many workers ending up being underpaid.

Implications of Brain Drain

The implications of brain drain in Malaysia and Indonesia cannot be overstated. The loss of skilled and educated individuals affects economic growth, reduces productivity, and creates a shortage of qualified personnel in numerous industries. In fact, Malaysia's University Malaya alone loses at least 30 of its best medical graduates to Singapore every year, at a cost of about RM1 million per student to train.?

The situation is not any better in Indonesia, where the departure of highly skilled individuals poses a significant threat to the country's science and technology sectors, making it challenging to keep pace with the demands of a rapidly changing global economy. Moreover, the cost of training professionals such as medical doctors and engineers only to lose them to other countries is a significant economic loss for both countries.?

Brain drain creates a knowledge gap, where industries may lack the necessary expertise to compete globally, leading to additional recruiting and training costs. Thus, it is imperative for employers and governments to take necessary measures to address this issue, which is, admittedly, easier said than done.