The Global Economy in Turbulent Times

CHAPTER 110 Toward Quality Undergraduate Education¹

The National Economic Advisory Council (NEAC) March 2010 Report stated: “Malaysia faces an exodus of talent. Not only is our education system failing to deliver the required talent, we have not been able to retain local talent of all races nor attract foreign ones due to poor prospects and a lack of high-skilled jobs.”² This simply does not make sense. Human capital lies at the heart of any high-income economy. It is key to Malaysia’s transformation agenda. Success in structural reform relies heavily on skill-intensive and innovation-led growth. Not surprisingly, human resource development features prominently in the new economic model. Simply put, this means it will need to develop, attract, and retain talent. Yet, the brain drain—that is, the cross-border migration of talent—runs counter to the compelling domestic need for a more skilled, more innovative, and more entrepreneurial labor force to be able to constantly add value.

Against this backdrop, the Malaysian experience is not unique. The World Bank estimated that in 2010, 215 million people live outside their country of birth, 80 percent from developing nations, with 43 percent living in high- income advanced economies.³ Within Asia, the most pronounced brain drain is in Southeast Asia. Malaysia’s brain drain is intensive, not because too many are leaving but because the skills base is narrow. This is compounded by the lack of compensating inflows. It is also concentrated ...