Using Remittance Transaction Data for Timely Estimation of the Foreign Worker Population in Malaysia
Malaysia has been grappling with understanding how many foreign workers reside in the country and thus faces challenges in formulating evidence-based foreign worker policies. This paper uses micro-level remittance transaction data collected from mo...
| Main Authors: | , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/788601595507343857/Using-Remittance-Transaction-Data-for-Timely-Estimation-of-the-Foreign-Worker-Population-in-Malaysia http://hdl.handle.net/10986/34249 |
| Summary: | Malaysia has been grappling with
understanding how many foreign workers reside in the country
and thus faces challenges in formulating evidence-based
foreign worker policies. This paper uses micro-level
remittance transaction data collected from money transfer
service providers to estimate the number of foreign workers.
Most foreign workers remit a large portion of their earnings
to support family members back home. They are low-income
earners, sensitive to remittance costs, and opt for money
transfer service providers to remit money rather than
regular banks, where transfer services are more expensive.
Therefore, the remittance data provide a useful source to
conduct the investigation. Existing estimates range from two
million to five million foreign workers; our results narrow
that range to between 2.99 million and 3.16 million foreign
workers in Malaysia as of 2017-18. The estimated state and
nationality distributions of foreign workers are consistent
with the Ministry of Home Affairs data, lending support to
the validity of the estimates. Nevertheless, the Bank Negara
Malaysia remittance data could potentially underestimate the
number of workers in states with low access to money service
providers and nationalities that have access to alternative
money transfer mechanisms such as commercial banking and
informal transfer channels. |
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