Include graduate unemployment in budget retabling

Graduate employability has remained a perennial issue over the past few years, with countless numbers of graduates struggling to find suitable jobs upon completing their studies. This situation not only compromises the fate of our future talents but also puts our country’s growth at risk, economically and socially.

Weak graduate marketability in Malaysia has resulted in youth unemployment and a lack of high-skilled workers to fulfil the needs and demands of the future workforce.

The graduate statistics as reported by the Department of Statistics Malaysia (DOSM) revealed the highest percentage of unemployed graduates in 2020, to 4.4% (202,400 graduates unemployed) against 2019 when the rate of unemployment stood at 3.9% (165,200). 

Despite several initiatives such as JaminKerja Keluarga Malaysia which saw an allocation of RM4.8 billion, Penjana HRD Corp (RM500 million in allocation from 2020 to 2021) and Malaysians@Work (RM6.5 billion) to reduce the number of unemployed graduates, the employability rate remains relatively high while the number of vacancies is still low. 

Graduates have been left with no choice but to work for the minimum wage or at non-graduate jobs in order to survive the high cost of living and make ends meet. This situation not only adds to the context of underemployment, it also contributes to the neglect of talents from a future high-skilled workforce that would benefit the economy as well as Malaysia's social trajectory.

Despite the expected drop in unemployment rate in 2023 from 3.7% to 3.5%, the economic report by the finance ministry discloses that the forecast only reflects a small-margin reduction, with more attention from the government needed to ease the problem of graduate unemployment. The proliferation in the number of graduates does not tally with the number that the job market can absorb, which makes it hard for them to find a job.

The government should look at ways to create new job opportunities, but these opportunities must not be taken lightly. The graduates must be offered jobs that will create value and long-term worth that contributes to the youth and national developments.

Maybe it is time for the relevant authorities to take another look at the delivery system of higher learning institutions or universities in the country. They should prepare undergraduates for the reality of what the job market is looking for instead of focusing on paper qualifications, to ease the problem of mismatched graduates who have to job hop from one company to another or who may not find employment at all.

The youth and sports and human resources ministries should be more proactive and embark on more effective approaches and measures to enhance graduate marketability.

The emergence of the k-economy has spawned a new notion of workplace literacy, changing the traditional covenant where employees expect stable or lifelong employment. The retention of employees will probably be based on skills and knowledge that can provide advantages to companies. 

The establishment of the Knowledge Economy Division in the Economic Planning Unit of the Prime Minister’s Department signifies the need to support the growth of conducive economic development through ICT development with the purpose of transforming Malaysia into an innovative, digital knowledge-based economy. Platforms such as technical and vocational education and training (TVET) can be further explored.

The higher education ministry recently announced new aspirations through 11 focuses including the rearrangement of the national TVET. This is a good sign that can push the potentiality of TVET in training and producing high-skilled graduates with high marketability.

However, having platforms like TVET to nurture our future talents might be insufficient if the government fails to bridge the gap in so far as cooperation with the private sector is concerned. It must work hand in hand with private companies, especially key industry players and investors, to produce better job placements.

Public and private organizations should be encouraged to set up programmes to employ potential fresh graduates as part of their corporate social responsibility. This helps to inject new blood for new ideas and a younger, capable workforce for key job continuity. 

Maybe it is time for the government to revisit the strategic thrusts in the Shared Prosperity Vision 2030 (SPV2030), which serves as a blueprint of its commitment to making this country a nation that achieves sustainable growth alongside equitable distribution. Maybe there are viable recommendations in the blueprint that can be beneficial, especially in tackling the issues of unemployment and underemployment.

The third strategic thrust of SPV2030, "Transforming Human Capital", mentions a focus on the need to enhance Malaysia’s workforce. It also highlights the importance of recognising human capital through professional training and skills retraining at every level, from school to the work environment, to bridge the gaps between the knowledge, skills and attitudes of graduates with industrial needs and demands. 

This pillar outlines several suggestions such as strengthening partnerships with industry players, improving quality control mechanisms and cultivating students’ interest towards future job prospects that will lead to a more skilled workforce, produced and directed towards high national productivity. 

Hopefully, the issues of graduate unemployment and underemployment will be included and given focus during the retabling of this year’s budget.

Decades ago, a university degree meant a guaranteed path to a well-paid and stable career. Unfortunately, this is no longer the case. The missing link between the production of graduates and their absorption into the labour market must be found for the good of all. 

The views expressed in this article are those of the author(s) and do not necessarily reflect the position of MalaysiaNow.