Research reveals gap in new skilled jobs and supply of graduates
PETALING JAYA: Malaysia’s economy is not producing enough skilled jobs and the trend has yet to show a positive sign, according to a study by Khazanah Research Institute (KRI).
The study titled “Limited Skilled Jobs Opportunity” produced by KRI researchers Hafiz Hafizi Suhaimi and Hawati Abdul Hamid revealed that the percentage of the total skilled jobs in Malaysia between 2015 and 2022 stands at a mere 25%.
Semi-skilled jobs, on the other hand, are dominating the market with 61% for the same period of 2015 to 2022.
“What’s worrying is, in terms of job creation, the distribution of new skilled jobs is declining from 49.8% in 2016 to only 29.5% in 2022.
“The lack of skilled job creation is being compensated by semi-skilled jobs, which saw an increase from 43.2% to 60.8% in the same period,” they said in the report published in March.
Not only that, the study also revealed that there are more graduates produced by universities each year to the point that the figure does not match the number of skilled jobs that exist in the country.
Between 2015 and 2022, there were about 300,000 graduates each year, but the creation of skilled jobs was only 55,000 yearly during the same period, they said, adding that most jobs created were in the semi-skilled level.
“The total number of new graduates in the workforce has increased from four million in 2015 to 5.2 million in 2022, while the total skilled jobs only increased from two million in 2015 to 2.2 million in 2022.
“What’s interesting is that although the number of highly educated graduates has increased in comparison to the amount of skilled jobs, many employers still find it difficult to hire them due to lack of experience or technical skills.
“To prevent this, there is a need for the actual knowledge and skills of the highly educated workforce in Malaysia to be refined so that the skills development programmes implemented are relevant and strategic.”
Based on a recent KRI report titled “Shifting Tides: Charting Career Progression of Malaysian Skilled Talents”, they said it was revealed that despite various efforts by the government, its target for creating skilled jobs could not be met.
“The creation of skilled jobs through these plans must be constantly monitored to ensure that the set targets will be achieved.”
At present, the two researchers said the service sector dominates the workforce at 51.6% between 2015 and 2022, followed by the manufacturing sector at 42.8% for the same period.
“But, if you look deeper, the percentage of skilled and semi-skilled jobs in the service sector is almost equal – 34.4% and 46.6% respectively.
“This means that the real ability of the service sector to contribute to increasing the value of the labour market is limited since semi-skilled jobs are still dominating the market.”
With the limited number of skilled jobs, the study revealed that some youths nowadays would prefer to skip attending universities and go for high-paying jobs that do not require a degree.
The researchers said youths believe that higher education is not bringing added value to them since they are looking for respectable salaries.
Statistics seem to be aligned with this conclusion, as skills-related underemployment statistics in 2023 show almost four out of every 10 employed graduates are in jobs that do not match their qualifications.
“This means that the salary received is also low because the skills required are semi-skilled or unskilled.
“In addition, the number of graduates who are in informal jobs also increased, from 8.6% in 2013 to 15.8% in 2023.
“The gig economy and being an influencer are among the attractions to this sector,” they said.
Additionally, they said other contributing factors include graduates choosing courses that are not in line with industrial requirements.
According to them, there are more graduates in the fields of social sciences, business and law compared to graduates with technical skills such as engineering, manufacturing and construction.
