Malaysia is making it easier for expats' spouses to work. Will that help retain foreign talent?

Malaysia is making it easier for expat spouses to seek employment, with the new policy set to take effect in January 2027. This change aims to retain foreign talent, as a spouse's inability to find work can be a deciding factor for expatriate families to leave. Currently, spouses of expats with a Category 1 employment pass must secure a separate job sponsorship, often resulting in relinquishing their dependant pass.

The new policy allows eligible spouses to work while retaining their dependant pass, provided they earn a monthly salary of at least RM20,000 (US$4,900). This move is part of Malaysia's broader strategy to attract investment and transition from a low-cost manufacturing and services hub to a high-value, innovation-driven economy.

Human resource professionals and employers have welcomed the development, but some economists caution that the measure is merely a minor adjustment to the current expat visa scheme. They argue that concerns regarding visa length, criteria for long-term visas, and residence requirements remain significant issues for expatriates considering long-term stays in Malaysia.

While the government has raised minimum salary thresholds for expats and mandated succession plans for Category 2 and 3 pass holders, the provision for spouses addresses a different concern. By ensuring that spouses can build a workable life in Malaysia, the government aims to attract and retain the talent it seeks, but its effectiveness depends on the availability of suitable employment opportunities and a straightforward approval process.