The role of ethnicity continues to be underplayed in employment analysis. Given the fragmentation of many homogenous societies and workforces and their increasing heterogeneous nature, such neglect not only highlights partiality, but is also problematic at the level of analysis, policy and practice. Likewise, the state and capital have been seen as overly uniform and monolithic rather than as shifting, transient and fragmented. Furthermore, the establishment and continuing growth of first and subsequent generation citizens implies a more nuanced analysis will be required of not only labour, but state and capital as well. These issues, however, are not unusual, nor marginal (although they may be marginalised), in some countries. We use the example of Malaysia, itself an old colonially produced type of multicultural society, to show the weaknesses of traditional views and to analyse and highlight the impacts of ethnicity with a view to developing a framework for incorporating this dimension into the discourse of employment.