• Insights

Labour Market Testing in the Asia-Pacific: Evolving Rules in a Global Talent Race

May 14, 2025

Labour Market Testing in the Asia-Pacific: Evolving Rules in a Global Talent Race

Countries / Territories

  • MalaysiaMalaysia
  • SingaporeSingapore

Related contacts

Khalisha Sharifah

Khalisha Sharifah

Practice Leader

Kuala Lumpur, Malaysia

Email

[email protected]

T:+60 (0)3 2280 3668

jenny_lee

Jenny Lee

Director

Singapore, Singapore

Email

[email protected]

T:+65 6854 9219

Maysie Pandor - web porthole

Maysie Pandor

Business Immigration Director

Singapore, Singapore

Email

[email protected]

T:+65 6849 4391

Related insights

  • The Asia Immigration Paradox Part 1: Navigating Competing Trends
  • The Asia Immigration Paradox Part 2: Competing for Global Talent
  • A New Beginning: The Rise of Highly Skilled Visa and Digital Nomad Visa Options in APAC
View all insights

Related offices

  • Kuala Lumpur
  • Singapore

Share

  • Twitter
  • Facebook
  • LinkedIn

Share

  • Twitter
  • Facebook
  • LinkedIn

Related contacts

Khalisha Sharifah

Khalisha Sharifah

Practice Leader

Kuala Lumpur, Malaysia

Email

[email protected]

T:+60 (0)3 2280 3668

jenny_lee

Jenny Lee

Director

Singapore, Singapore

Email

[email protected]

T:+65 6854 9219

Maysie Pandor - web porthole

Maysie Pandor

Business Immigration Director

Singapore, Singapore

Email

[email protected]

T:+65 6849 4391

Related insights

  • The Asia Immigration Paradox Part 1: Navigating Competing Trends
  • The Asia Immigration Paradox Part 2: Competing for Global Talent
  • A New Beginning: The Rise of Highly Skilled Visa and Digital Nomad Visa Options in APAC
View all insights

Related offices

  • Kuala Lumpur
  • Singapore

Share

  • Twitter
  • Facebook
  • LinkedIn

Share

  • Twitter
  • Facebook
  • LinkedIn

Related contacts

Khalisha Sharifah

Khalisha Sharifah

Practice Leader

Kuala Lumpur, Malaysia

Email

[email protected]

T:+60 (0)3 2280 3668

jenny_lee

Jenny Lee

Director

Singapore, Singapore

Email

[email protected]

T:+65 6854 9219

Maysie Pandor - web porthole

Maysie Pandor

Business Immigration Director

Singapore, Singapore

Email

[email protected]

T:+65 6849 4391

Related insights

  • The Asia Immigration Paradox Part 1: Navigating Competing Trends
  • The Asia Immigration Paradox Part 2: Competing for Global Talent
  • A New Beginning: The Rise of Highly Skilled Visa and Digital Nomad Visa Options in APAC
View all insights

Related offices

  • Kuala Lumpur
  • Singapore

Share

  • Twitter
  • Facebook
  • LinkedIn

Share

  • Twitter
  • Facebook
  • LinkedIn

By: Khalisha Sharifah, Jenny Lee, Maysie Pandor

Across the Asia-Pacific region, governments continue to review and recalibrate their immigration policies, navigating national skills shortages and the geopolitical competition for talent, with a strong desire to protect the local workforce.

One tool that has emerged at the forefront of these policies is Labour Market Testing (LMT). At its core, LMT serves as a crucial mechanism for ensuring local workers are given priority in filling roles before employers seek talent from abroad. However, LMT frameworks must also balance the realities of global labour shortages and the growing need for international talent.

Singapore, Malaysia and Vietnam are among several countries in the Asia-Pacific region that sit at the core of regional supply-chains that run from technology hubs to advanced manufacturing sites and service-delivery centres. All three economies compete for foreign investment yet face intense domestic pressure to ring-fence jobs for their citizens. The result is a patchwork of LMT rules that have tightened since the pandemic but now pivot toward data-driven transparency and skill-shortage targeting instead of blanket protectionism.

Regional LMT Frameworks

As one example, Singapore’s Fair Consideration Framework (FCF), which has been in place for more than 10 years, requires employers to advertise job vacancies on a national job portal for at least 14 days  and consider all candidates fairly before submitting a Work Pass application.

Singapore’s more developed LMT framework has often been a blueprint for neighbouring countries, including Malaysia, which implemented its own framework in 2023, aiming to protect its local workforce in a post-pandemic world. When Malaysia first implemented its framework, it requested employers to advertise job vacancies for at least 30 days but that has since been reduced to 14 days, in an effort to make the process simpler.

In Vietnam, to note, employers have long been required to preserve evidence of their recruitment efforts within the local market, with a focus on providing an employer-led justification when hiring a foreign national. In a move to emulate its regional neighbors, a formal LMT process was adopted in 2024, mandating employers to submit proof of LMT (conducted for least 15 days before seeking to hire a foreign national), adding an additional step to an already protracted process.

Interestingly, while Malaysia and Vietnam only recently started to build out their LMT policies, Singapore has continued to evolve its LMT requirements and added an additional layer in September 2023, as a result of the introduction of the COMPASS points-based system, which sits on top of the FCF (scoring each Employment Pass candidate on diversity, skills match and whether the employer is investing in local workforce development). The effect is a two-layer filter—first a labour-market test focusing on the position, then a complementarity test focusing on the individual applicant and employer.

Digitalisation

While government online portals have always played a pivotal role in managing LMT, over time the process has evolved through enhancements in digitalisation and an increase in data monitoring, particularly in Singapore and Malaysia. This increases transparency, making it easier for authorities to verify compliance.

      • Job Posting and Application Tracking: In both countries, the portals allow employers to not only post open roles, but also manage job advertisements, including the ability to screen candidates, and even filter applications by skills relevance. Both country portals feature job-candidate matching tools, whereas in Vietnam, job matching is still a largely manual process, requiring job seekers to physically visit local Employment Services Centers to discuss potential open roles.
      • Review Mechanism: Employers across the region are typically required to review applications from local candidates before considering foreign applicants, though their obligations vary across each country. In Malaysia, a Hiring Outcome Report must always be submitted to the Social Security Organisation (PERKESO), even if there was no suitable candidate for a particular role. PERKESO will then issue a letter either supporting or opposing the Employment Pass application, adding an additional layer to the process.
      • Transparency: In Singapore, the Ministry of Manpower has visibility of the portal, job postings and activity and can track employer behaviour behind the scenes, thus creating audit-ready data streams. Employers may be penalised if found to circumvent the principles of the FCF, potentially facing delays or rejections in future Work Pass applications or suspension of Work Pass privileges. In Malaysia, if an employer failed to obtain the supporting letter, an appeal to PERKESO must be made (as it has full control and discretion over the decision made). 

Skills Shortages & Exemptions

One of the primary criticisms of LMT is that it can be an obstacle to businesses seeking to fill talent gaps quickly, especially in fast-moving sectors like technology or healthcare. The process can be time-consuming, costly, and administratively burdensome, requiring extensive documentation and advertising efforts that may delay hiring decisions.

To tackle this, some governments have created simplified pathways or exemptions to LMT. In Singapore and Malaysia, roles may be exempt from the job posting requirement under certain circumstances, including for high-salaried positions and intra-corporate transferees. Short-term work passes and renewals in Malaysia are also exempted from the need to post job advertisements. Singapore also creates exemptions for small companies with fewer than 10 employees, and short-term roles of up to one-month, with renewals similarly exempted.

Governments are also aiming to insulate high-value or hard-to-fill roles from the full weight of LMT, through additional points for skills-shortages occupations via COMPASS in Singapore, or through Australia’s forthcoming Skills-in-Demand visa (as another example). Targeting skills shortages through such points tests, or shortage occupation lists, replaces a one-size-fits-all approach with a more nuanced framework, taking into account the realities of the market.

Ongoing Protection of Labour Market

Governments continue to look at innovative ways to protect the local market beyond LMT. Earlier this year, the Ministry of Human Resources in Malaysia announced a scheme, due to be formally launched in 2026, to require companies to hire local students as interns once they have hired foreign nationals for full-time roles, with the aim to ensure local young talent are workforce-ready and to increase their employability upon completion of their studies. While this isn’t an LMT per se, it is certainly an example of the government trying to balance the need to protect the local market while continuing to attract foreign talent.

Other markets, such as Indonesia, so far omit any explicit LMT requirements while still imposing some knowledge transfer obligations, tying approvals of Work Permits to documented plans for up-skilling locals. This moves the nature of LMT from negative, i.e. proving no local Indonesian exists to fill the role, to positive, i.e. to demonstrate that the company will create even more jobs for locals. Furthermore, the Ministry of Manpower requires a commitment from companies to a particular ‘local-to-foreign' staffing ratio, and reserves certain occupations, such as in human resources, exclusively for citizens.

Looking Ahead

As the global competition for talent intensifies, LMT remains a cornerstone of immigration policy in many countries. However, as businesses and economies evolve, it is clear that the traditional models of LMT will need to adapt to the realities of a more interconnected and technology-driven world.

The Asia-Pacific region showcases two complementary philosophies: a rules-based, portal-centred model designed for transparency and analytics, such as in Singapore and Malaysia, and a case-by-case, plan-based model that emphasises qualitative justification and skills transfer, like in Vietnam and Indonesia. Policymakers are sharpening both approaches to target genuine shortages without stoking domestic resentment.

Governments typically walk a tightrope between attracting foreign talent and ensuring employment opportunities for their citizens - keeping doors open to investment and advanced skills while signaling that citizens remain first in line for available jobs. By embracing more flexible and adaptive LMT processes, countries can remain competitive in the global talent race while fostering an inclusive and dynamic workforce.

For employers, the message is clear: align global talent strategies with local workforce priorities, and stay agile, as governments continue to refine the balance between openness and protection in an era of intense competition for skills.

Need to Know More?

For questions regarding labour marketing testing in APAC, please contact Practice Leader Khalisha Sharifah at [email protected] and Directors Jenny Lee and Maysie Pandor at [email protected] and [email protected], respectively.   

This blog was published on 14 May 2025 and due to the circumstances, there are frequent changes. To keep up to date with all the latest updates on global immigration, please subscribe to our alerts and follow us on LinkedIn, Twitter, Facebook and Instagram. 

Countries / Territories

  • MalaysiaMalaysia
  • SingaporeSingapore

Related contacts

Khalisha Sharifah

Khalisha Sharifah

Practice Leader

Kuala Lumpur, Malaysia

Email

[email protected]

T:+60 (0)3 2280 3668

jenny_lee

Jenny Lee

Director

Singapore, Singapore

Email

[email protected]

T:+65 6854 9219

Maysie Pandor - web porthole

Maysie Pandor

Business Immigration Director

Singapore, Singapore

Email

[email protected]

T:+65 6849 4391

Related insights

  • The Asia Immigration Paradox Part 1: Navigating Competing Trends
  • The Asia Immigration Paradox Part 2: Competing for Global Talent
  • A New Beginning: The Rise of Highly Skilled Visa and Digital Nomad Visa Options in APAC
View all insights

Related offices

  • Kuala Lumpur
  • Singapore

Share

  • Twitter
  • Facebook
  • LinkedIn

Share

  • Twitter
  • Facebook
  • LinkedIn

Related contacts

Khalisha Sharifah

Khalisha Sharifah

Practice Leader

Kuala Lumpur, Malaysia

Email

[email protected]

T:+60 (0)3 2280 3668

jenny_lee

Jenny Lee

Director

Singapore, Singapore

Email

[email protected]

T:+65 6854 9219

Maysie Pandor - web porthole

Maysie Pandor

Business Immigration Director

Singapore, Singapore

Email

[email protected]

T:+65 6849 4391

Related insights

  • The Asia Immigration Paradox Part 1: Navigating Competing Trends
  • The Asia Immigration Paradox Part 2: Competing for Global Talent
  • A New Beginning: The Rise of Highly Skilled Visa and Digital Nomad Visa Options in APAC
View all insights

Related offices

  • Kuala Lumpur
  • Singapore

Share

  • Twitter
  • Facebook
  • LinkedIn

Share

  • Twitter
  • Facebook
  • LinkedIn

Related contacts

Khalisha Sharifah

Khalisha Sharifah

Practice Leader

Kuala Lumpur, Malaysia

Email

[email protected]

T:+60 (0)3 2280 3668

jenny_lee

Jenny Lee

Director

Singapore, Singapore

Email

[email protected]

T:+65 6854 9219

Maysie Pandor - web porthole

Maysie Pandor

Business Immigration Director

Singapore, Singapore

Email

[email protected]

T:+65 6849 4391

Related insights

  • The Asia Immigration Paradox Part 1: Navigating Competing Trends
  • The Asia Immigration Paradox Part 2: Competing for Global Talent
  • A New Beginning: The Rise of Highly Skilled Visa and Digital Nomad Visa Options in APAC
View all insights

Related offices

  • Kuala Lumpur
  • Singapore

Share

  • Twitter
  • Facebook
  • LinkedIn

Share

  • Twitter
  • Facebook
  • LinkedIn

Explore more at Fragomen

Media mentions

CEDA: The Drive to Reduce Net Overseas Migration and the Challenges for Business

Managing Partner, Australia and New Zealand Teresa Liu discusses how Australia’s efforts to reduce net overseas migration are affecting businesses amid ongoing skilled workforce shortages.

Learn more

Media mentions

Australian Broadcasting Corporation: Overnights

Senior Counsel Dr. Anna Boucher discusses Australia’s net migration figures and recent changes to the country’s migration policies.

Learn more

Blog post

Can International Graduates in the Netherlands Qualify for the 30% Ruling? Eligibility Rules Explained

Tiemen Peters, Silvia Norte Mercade and Soraya Driessen outline when international graduates who studied in the Netherlands may qualify for the 30% ruling and the key eligibility, timing and compliance considerations for graduates and employers.

Learn more

Blog post

The Narrowing Talent Pipeline: From International Student to Corporate America

Counsel Susan Steger discusses how recent immigration developments may affect the pathway from F-1 study and practical training through H-1B sponsorship and permanent residence for U.S. employers recruiting and retaining early-career international talent.

Learn more

Blog post

Right to Work Changes: What Do They Mean for Employers in Northern England?

Manager Ko Ito, Senior Immigration Consultant Danielle Barks, Associate Naureen Malik and Trainee Solicitor Amna Ali outline how the expanded UK Right to Work Scheme could affect employers in Northern England and the practical steps businesses can take ahead of the 1 October 2026 changes.

Learn more

Media mentions

Business Traveller: Six Months in, the EU’s Entry/Exit System Isn’t Working

Partner Christine Sullivan discusses the implementation of the EU’s Entry/Exit System (EES) across member states and at border crossing points.

Learn more

Blog post

Polish Citizenship by Descent: A Practical Guide for 2026

Poland Immigration Strategy Director Tomasz Rogala, Senior Associate Tomasz Rdzanek and Senior Immigration Consultant Paulina Fołta-Cisak discuss who may qualify for Polish citizenship by descent, how historical events can affect a claim and what applicants should expect from the 2026 confirmation process.

Learn more

Media mentions

ABC News: What Australia can learn from 165 years of migration data

Senior Counsel Anna Boucher is quoted in ABC News regarding Australia's migration debate and what more than 165 years of migration data reveals about long-term immigration trends.

Learn more

Blog post

Swiss Immigration Quotas 2026: Are Work Permit Quotas Likely to Run Out Before Year-End?

Senior Immigration Consultant Alessandra Rüede discusses Switzerland’s 2026 work permit quota utilisation and what current availability, canton-level allocation practices and processing considerations mean for employers planning international hiring and mobility.

Learn more

Blog post

From Investment to Merit: Malta’s Citizenship Reset

Director Isobel Neilson and Manager Sophie Jo Wasson discuss Malta’s shift from citizenship by investment to merit-based naturalisation and outline what may contribute to a compelling application based on exceptional merit and national interest.

Learn more

Fragomen news

Letter to ICE/Student and Exchange Visitor Program on Curricular Practical TrainingLearn more

Blog post

Right to Work Changes from 1 October 2026: Why Employers Need to Act Now

Partner Naomi Goldshtein discusses the UK Right to Work changes taking effect from 1 October 2026 and what employers should do now to strengthen identity verification, workforce oversight and compliance across direct and extended worker populations.

Learn more

Media mentions

CEDA: The Drive to Reduce Net Overseas Migration and the Challenges for Business

Managing Partner, Australia and New Zealand Teresa Liu discusses how Australia’s efforts to reduce net overseas migration are affecting businesses amid ongoing skilled workforce shortages.

Learn more

Media mentions

Australian Broadcasting Corporation: Overnights

Senior Counsel Dr. Anna Boucher discusses Australia’s net migration figures and recent changes to the country’s migration policies.

Learn more

Blog post

Can International Graduates in the Netherlands Qualify for the 30% Ruling? Eligibility Rules Explained

Tiemen Peters, Silvia Norte Mercade and Soraya Driessen outline when international graduates who studied in the Netherlands may qualify for the 30% ruling and the key eligibility, timing and compliance considerations for graduates and employers.

Learn more

Blog post

The Narrowing Talent Pipeline: From International Student to Corporate America

Counsel Susan Steger discusses how recent immigration developments may affect the pathway from F-1 study and practical training through H-1B sponsorship and permanent residence for U.S. employers recruiting and retaining early-career international talent.

Learn more

Blog post

Right to Work Changes: What Do They Mean for Employers in Northern England?

Manager Ko Ito, Senior Immigration Consultant Danielle Barks, Associate Naureen Malik and Trainee Solicitor Amna Ali outline how the expanded UK Right to Work Scheme could affect employers in Northern England and the practical steps businesses can take ahead of the 1 October 2026 changes.

Learn more

Media mentions

Business Traveller: Six Months in, the EU’s Entry/Exit System Isn’t Working

Partner Christine Sullivan discusses the implementation of the EU’s Entry/Exit System (EES) across member states and at border crossing points.

Learn more

Blog post

Polish Citizenship by Descent: A Practical Guide for 2026

Poland Immigration Strategy Director Tomasz Rogala, Senior Associate Tomasz Rdzanek and Senior Immigration Consultant Paulina Fołta-Cisak discuss who may qualify for Polish citizenship by descent, how historical events can affect a claim and what applicants should expect from the 2026 confirmation process.

Learn more

Media mentions

ABC News: What Australia can learn from 165 years of migration data

Senior Counsel Anna Boucher is quoted in ABC News regarding Australia's migration debate and what more than 165 years of migration data reveals about long-term immigration trends.

Learn more

Blog post

Swiss Immigration Quotas 2026: Are Work Permit Quotas Likely to Run Out Before Year-End?

Senior Immigration Consultant Alessandra Rüede discusses Switzerland’s 2026 work permit quota utilisation and what current availability, canton-level allocation practices and processing considerations mean for employers planning international hiring and mobility.

Learn more

Blog post

From Investment to Merit: Malta’s Citizenship Reset

Director Isobel Neilson and Manager Sophie Jo Wasson discuss Malta’s shift from citizenship by investment to merit-based naturalisation and outline what may contribute to a compelling application based on exceptional merit and national interest.

Learn more

Fragomen news

Letter to ICE/Student and Exchange Visitor Program on Curricular Practical TrainingLearn more

Blog post

Right to Work Changes from 1 October 2026: Why Employers Need to Act Now

Partner Naomi Goldshtein discusses the UK Right to Work changes taking effect from 1 October 2026 and what employers should do now to strengthen identity verification, workforce oversight and compliance across direct and extended worker populations.

Learn more
Fragomen.com home
Select Language
  • English
  • French
  • French - Canadian
  • German

Select Language

  • English
  • French
  • French - Canadian
  • German
ContactCareersMediaClient Portal
Search Fragomen.com
  • Our Services
    For EmployersFor IndividualsBy IndustryCase Studies
  • Our Tech & Innovation
  • Our People
  • Our Insights
    Worldwide Immigration Trends ReportsMagellan SeriesImmigration AlertsEventsMedia MentionsFragomen NewsBlogsPodcasts & Videos
  • Spotlights
    Travel and Mobility Considerations: Situation in the Middle EastNavigating Immigration Under the Second Trump AdministrationImmigration Matters: Your U.S. Compliance RoadmapCenter for Strategy and Applied InsightsView More
  • About Us
    About FragomenOfficesResponsible Business PracticesFirm GovernanceRecognition

Our Services

  • For Employers
  • For Individuals
  • By Industry
  • Case Studies

Our Tech & Innovation

  • Our Approach

Our People

  • Overview / Directory

Our Insights

  • Worldwide Immigration Trends Reports
  • Magellan Series
  • Immigration Alerts
  • Events
  • Media Mentions
  • Fragomen News
  • Blogs
  • Podcasts & Videos

Spotlights

  • Travel and Mobility Considerations: Situation in the Middle East
  • Navigating Immigration Under the Second Trump Administration
  • Immigration Matters: Your U.S. Compliance Roadmap
  • Center for Strategy and Applied Insights
  • View More

About Us

  • About Fragomen
  • Offices
  • Responsible Business Practices
  • Firm Governance
  • Recognition
Select Language
  • English
  • French
  • French - Canadian
  • German

Select Language

  • English
  • French
  • French - Canadian
  • German
ContactCareersMediaClient Portal
Important Updates
Important Updates
September 18, 2026 | AustraliaAustralia: Skilled Visa Processing Priorities Revised
September 21, 2026 | AustraliaCEDA: The Drive to Reduce Net Overseas Migration and the Challenges for Business
September 21, 2026 | ChinaChina: Online Portal Opened for Accommodation Registration
September 21, 2026 | United KingdomUnited Kingdom: Mandatory Multi-Factor Authentication Rolls Out for Sponsor Licence Users
September 18, 2026 | AustraliaAustralia: Further Migration Reforms to Reduce Net Overseas Migration Announced
September 18, 2026 | AustraliaAustralia: Skilled Visa Processing Priorities Revised
September 21, 2026 | AustraliaCEDA: The Drive to Reduce Net Overseas Migration and the Challenges for Business
September 21, 2026 | ChinaChina: Online Portal Opened for Accommodation Registration
September 21, 2026 | United KingdomUnited Kingdom: Mandatory Multi-Factor Authentication Rolls Out for Sponsor Licence Users
September 18, 2026 | AustraliaAustralia: Further Migration Reforms to Reduce Net Overseas Migration Announced
September 18, 2026 | AustraliaAustralia: Skilled Visa Processing Priorities Revised
Subscribe

Stay in touch

Subscribe to receive our latest immigration alerts

Subscribe

Our firm

  • About
  • Careers
  • Firm Governance
  • Media Inquiries
  • Recognition

Information

  • Attorney Advertising
  • Legal Notices
  • Privacy Policies
  • AI Transparency Statement
  • UK Regulatory Requirements

Our firm

  • About
  • Careers
  • Firm Governance
  • Media Inquiries
  • Recognition

Information

  • Attorney Advertising
  • Legal Notices
  • Privacy Policies
  • AI Transparency Statement
  • UK Regulatory Requirements

Have a question?

Contact Us
  • LinkedIn
  • Youtube
  • Instagram
  • Facebook
  • TikTok
  • Twitter

© 2026 Fragomen, Del Rey, Bernsen & Loewy, LLP, Fragomen Global LLP and affiliates. All Rights Reserved.

Please note that the content made available on this site is not intended for visitors / customers located in the province of Quebec, and the information provided is not applicable to the Quebec market. To access relevant information that applies to the Quebec market, please click here.