Approval of foreign workers grew by 12 percent post-pandemic

Number of foreign workers in the country as of 30 December 2022. (Source; Foreign Workers Management System)

The major chunk of foreign workers are employed in the construction and manufacturing sectors

The number in the approval of foreign workers by the Department of Labour (DoL) has seen a drastic rise after the borders were reopened following the closing stages of the coronavirus pandemic.

In 2022, the number of foreign workers’ approval was 88,480 while in 2019, before the covid-19 pandemic, the number of work permit approval stood at 79,003.

The approval for 2022 saw an increase of about 12% to the approval in 2019.

The DoL under the Ministry of Industry, Commerce and Employment (MoICE) however noted that these are just the approval figures, and the statistics do not translate into the actual entry and indicate how many workers are already inside the country.

When it comes to foreign workers the Labour Department maintains the approval and application rejection data while the Immigration Department maintains the entry and exit data. However, the two departments are working on integrating the two database systems into a common one.

The difference between the past and present approval methods according to the DoL is, in the past, it was based on the ceiling for certain occupations within the government-approved ceiling of 45,000 foreign workers. The ceiling excluded project-tied import of foreign workers such as hydropower projects.

However, starting in June 2022 the government increased the ceiling to 100,000 in line with the post-pandemic Economic Recovery Plan (ERP).

The MoICE also introduced the Dependency Ratio Ceiling (DRC) and Sector Quota, which is a part of the effort to move towards demand-driven or need-based approval of foreign workers.

As per records in the Foreign Workers Management System (FWMS), the total number of foreign workers as of 30 December 2022 was 61,304 which was an increase of three folds from the previous year 2021 which had only around 18,000 foreign workers.

DoL indicated that the foreign worker’s data is variable. They said by now, many of them would have left for their homes due to the cold weather or for vacations.

A major chunk of foreign workers is engaged in the construction and manufacturing sectors. Most of the occupations under these two sectors fall under the craft and related trade categories.

An official from DoL said, “We might not be in the position to exactly point out the reasons why the number of foreign workers has increased in 2022.”  He added that they have not conducted any studies to find out the precise factors.

However, he said the descriptive analysis of the approval date (2022 and 2023) reveals that between 75-80% of the foreign workers’ approval was for the construction sectors.

“That possibly could indicate that the construction sector, and building of private homes, had slowed down during the pandemic which is now gaining steam,” he said.

The other possible reason for the increase in the demand for foreign workers is the non-availability of Bhutanese workers for manual work.

Bhutan Times found that all foreign workers are on a temporary or contract basis whereas there are some foreign workers in the professional category who are on regular contracts. For instance, teachers and health workers are recruited on a regular contract basis.

The DoL official said that the foreign worker’s data is not constant. “One must establish clearly whether it is the approval data, entry data (in that reference period), or foreign workers within the country at the time.”

He added that the foreign worker data is dynamic because foreign workers are entering and leaving the country regularly. “We are trying to build the real-time data through the Foreign Workers Management System (FWMS).”

However, he said the process is taking time because of the need to integrate with other systems of the Immigration Department and Royal Bhutan Police who maintain the entry and exit data.

“The integration of the FWMS and Immigration Management System is still being worked on, and there are some technical glitches to be addressed,” he said.

When this paper questioned why it is necessary for recruiting a massive number of foreign workers when there is an abundant local workforce, the DoL official responded that they might not have the answer because no study has been carried out thus far.

However, the department assumed that locally trained and skilled individuals are not willing to work in construction sectors while some worksites are located in remote areas.

As the majority of foreign workers are employed in the construction sector, it could be that the demand itself is high compared to the local manpower available. Otherwise, when it comes to wages, the construction sector pays one of the highest wages among other sectors, said the official.

He further added it could also be that Bhutanese people in general prefer foreign workers as they are affordable (not necessarily cheap), work hard, and are willing to carry out tasks as demanded by their employers. He went on to say that the local workforce also lacks expertise in certain areas and occupations.

To reduce the number of foreign workers in the country, some of the initiatives taken by the government are to focus on Instituted Certified Builders and Specialized Firms to cater to the private and other individuals wishing to build and renovate homes and avail of other services, including maintenance.

These certified builders and specialized firms are expected to reduce the demand for foreign workers.

Meanwhile, DoL is in the process of organizing domestic plumbing and electrician workforce so that they can gradually take over these works from foreigners.

These works are done mostly by foreign workers, especially in private house constructions. The department will also discourage certain occupations among foreign workers as local workers become more available.

Increasing the intake of the vocational training institute and aligning their programmes with the local skills demand is another alternative that DoL came up with.

The department further added that industry-institute collaboration through modular courses on-the-job training programmes and Dual Training Programmes are some other measures in the pipeline.