Johor’s Data Centres: Implications for the Talent Landscape

Editor’s Note: This article is the 6th most-viewed commentary on Fulcrum in 2025. It was first published on 25 March 2025.

Malaysia has been setting itself up as a technology and artificial intelligence (AI) hub in recent years. Data centres — physical facilities that house computing infrastructure like servers and storage — form the backbone of the digital economy, enabling everything from cloud computing to AI-driven applications.

Johor in particular has been named the fastest growing market for data centres within Southeast Asia and data centres have been described as the state’s next economic frontier. Key players include tech giant Microsoft and data centre player Nvidia.

At present, there are a total of 47 planned and operational data centres in Johor. Seven among these were approved between 2021 and mid-June 2024, of which four have been completed and are in operation while another three are in various stages of planning or construction.

The Malaysian government and industry players have touted foreign investment in digital infrastructure as a driver of employment and economic growth. However, concerns surrounding the impact of such investment on the talent landscape remain. These concerns span three areas: the number and types of jobs created, the availability of talent, and talent retention.

In line with Malaysia’s aspirations to shift towards a digital economy and in anticipation of job creation in the data centre sector, the Johor Talent Development Council (JTDC) launched the first Data Centre Technician Programme on 1 March 2025. This programme seeks to fill 200 job vacancies, with salaries ranging from RM3,500 (US$790) to RM4,000 (US$902) for a minimum diploma qualification. Some youths commute long distances to Johor to attend this programme, believing that it unlocks promising career opportunities.

However, the promise of job creation in the data centre sector, especially jobs requiring technical skills, may be illusory.

Part of the problem is inherent in the nature of data centres, which have been described as no different from traditional infrastructure projects like highways or bridges, whose primary value lies in utility rather than job creation in the long term. A typical data centre requires an average of just 30 to 50 permanent jobs, with larger facilities creating up to 200 jobs.

Based on the current figure of 47 planned and operational data centres and even with an aggressive estimate of 200 employees each, there would be under 10,000 jobs created in data centres themselves. A more realistic estimate, based on 50 employees each, would be 2,500 jobs.

In addition, many big tech companies have traditionally preferred to import talent for higher-end jobs.

This has been the case for investments elsewhere by the very same companies that have invested in Malaysia. Microsoft’s data centre investment in Boydton, Virginia, is a case in point. The company reportedly brought in outside technicians, creating jobs for about only 25 local residents, primarily as administrative assistants or janitorial staff. Similar concerns about the job creation potential in data centres have been raised about data centres in Johor.

Nonetheless, even if the data centre sector per se fails to generate a huge demand for technical skills, the sector needs to be supported by a skilled workforce in ancillary industries, particularly the construction industry.

The building and development of data centres requires specialist knowledge, and the construction industry itself is undergoing digital transformation. The data centre sector thus has the potential to generate demand for technical skills which are transferrable across the construction industry.

Data centres [are] no different from traditional infrastructure projects like highways or bridges, whose primary value lies in utility rather than job creation in the long term.

Malaysia Technology Transformation & Creativity (MTTC) College, a private technical and vocational education and training (TVET) institution, seeks to equip building and development graduates with precisely such high-tech skills. MTTC College expanded to Johor Bahru in 2024 at the invitation of the Sunway group.

Founder and principal of MTTC College Ts. Charlenne Ong noted in an interview with this author that MTTC’s two-year diploma graduates reported a 100 per cent job placement rate. Ts. Ong observed, “demand [for such skills] is so high, companies are waiting to take graduates.” Many graduates work as building information modelling (BIM) consultants, with clients including data centres in the Iskandar Puteri area, facility managers, and 3D modelling designers.

Mr Low, managing director of a BIM consulting firm, highlighted the intensive skills demands in data centre construction. He told this author that the compressed one-year timeline of building data centres and stringent client requirements demand that workers keep updated with the newest software.

This trend towards higher-value jobs should nonetheless be interpreted with cautious optimism. Mr Low noted that “demand [for BIM] is high, but clients are not willing to pay. Software is expensive, talent is expensive.” Industry players further pointed out that a recent policy that stipulates the use of BIM for all infrastructure projects in Malaysia worth RM10 million (US$2.26 million) and above has been limited to government projects thus far. Still, contractors are taking the initiative to use BIM, nudging the construction sector towards digital transformation.

Even as local talent is increasingly available in Johor, retainability remains a challenge.

Promotional campaigns of TVET institutions continue to highlight Singapore’s more lucrative pay to attract prospective students. In an equity crowdfunding pitch, the presentation showed job listings in Singapore for the sector starting at S$3,600 (US$2,691), which remains about three times the average starting pay in Malaysia, or two times that of Johor.

Ts. Ong also told this author that TVET colleges like MTTC have signed long-term contracts with Singapore-based firms to provide the latter with a steady stream of talent.

The Johor-Singapore Special Economic Zone (JS-SEZ)’s goal of creating 20,000 high-skilled jobs within the next five years may bode well for improving talent retention. JTDC also announced a premium minimum salary in Johor of RM4,000 (US$902) for diploma holders and RM5,000 (US$1,128) for those with a Malaysian Skills Certificate equivalent to a degree.

If these plans materialise, they would be pivotal to addressing the long-standing issue of brain drain. For now, it appears that knowledge workers for data centres, including knowledge workers to support the building and development of data centres, are increasingly available.