By Jason Leong Han Zhong
The youth underemployment situation in Malaysia has yet to garner the needed attention despite its concerning numbers. In 2021, there were 4.57 million employed graduates, where 2.9% were time-related underemployed while 33.9% were skill-related-underemployed. Overall, the proportion of underemployed youth (% of total graduate workforce) has remained largely unchanged from 2017 to 2023 while nominal numbers show an uptrend, showing a need for reassessment of intervention strategies.
With underemployment among youth comes various other challenges, including a relatively low average salary for graduates. In fact, 28.7% of graduate placements in 2022 began with monthly earnings below RM1,999. Couple this with the lack of high-skilled job creation (only 12% of jobs created per annum from 2010 to 2019), there is little room for these graduates to experience both career and wage advancements. Additionally, the market of medium to low skill jobs become more concentrated as higher skilled graduates are pushed into these sectors, competing with lower skilled graduates hence further pressure to push down real wages.
What are the consequences of a delayed action to deal with this?