Oil Palm Industry Economic Journal Vol. 18 (1) March 2018 p. 41-49

Labour Requirements in the Independent Oil Palm Smallholder Sector in Peninsular Malaysia

Azman, I*; Ali Zulhusni; Norhidayu, A; Siti Mashani; Khairuman, H; Ainul, S and N Balu
Received:    Accepted:    Available Online:


The Malaysian oil palm industry is labour-intensive, especially in the plantations. Activities such as harvesting and fresh fruit bunch (FFB) collection require more labour than the other activities. Currently, estate owners including independent smallholders report that they are facing labour shortages for those afore mentioned activities in particular. This study aims to estimate the labour requirements and shortage in the independent oil palm smallholder sector in Peninsular Malaysia, and to formulate a solution for reducing the labour shortage problem. For data collection, face-to-face interviews using close-ended questionnaires were employed, involving a total of 385 independent smallholders throughout Peninsular Malaysia who were randomly selected. The study found that, on average, the age of the respondents was 58 years and 92% of the respondents hired workers for harvesting and FFB collection. The majority of the workers (65%) were foreigners, mostly from Indonesia. Total labour and labour shortage for harvesting and FFB collection operations in the independent oil palm smallholders sector in Peninsular Malaysia are estimated at 25 014 and 3715 respectively. In order to reduce the dependency on foreign workers and labour shortage problem, graduates from ‘Kursus Operasi Mekanisasi Ladang’ organised by MPOB should be encouraged to be contractors, so that they can manage the independent smallholders, especially for harvesting and FFB collection. For that, the government can provide incentives in the form of soft loans or discounts to enable them to purchase harvesting tools and evacuation machines at a lower price.

Keywords: independent smallholders, labour requirement, labour shortage, foreign workers

About Post Author

* Malaysian Palm Oil Board,
6 Persiaran Institusi,
Bandar Baru Bangi,
43000 Kajang, Selangor,
Email: azman@mpob.gov.my