Summary Charting Career Progression of Malaysias Skilled Talents www.krinstitute.org
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Malaysia's tertiary education system faces challenges in producing employable graduates with the necessary skills, leading to a skills mismatch and disparities in employment and income levels.
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Key Points
- Graduate employability in Malaysia has improved, reaching 84.8% in 2021, but less than two-thirds of graduates are employed soon after completing their studies
- The share of graduates in non-standard employment, such as temporary/contract work and self-employment, has increased significantly, raising concerns about job security and career progression
- Skills mismatch is a growing issue, with over 48% of graduates working in jobs that do not match their qualification level, particularly affecting fresh graduates
- Experienced graduates have higher employment rates, more stable jobs, and better salaries compared to fresh graduates, but overqualification remains a persistent issue
- The government has introduced various policy frameworks to promote entrepreneurship and self-employment among graduates, but accessibility and awareness issues need to be addressed
- Inadequate high-skilled jobs, with the number of tertiary-educated workforce exceeding high-skilled jobs by twofold, leading to many graduates being employed in low- or semi-skilled jobs or non-standard employment
- Tailored support is needed for different types of graduate entrepreneurs, with financing and administrative challenges for employers versus personal skill gaps for sole proprietors
Summaries
23 word summary
Malaysia's tertiary education faces challenges in developing human capital. Graduate employability is low, with skills mismatch and disparities across qualifications and income levels.
52 word summary
Malaysia's tertiary education faces challenges in developing human capital. Graduate employability is low, with skills mismatch and low pay, especially for diploma holders and low-income families. Disparities exist, with degree holders, public university graduates, and higher-income families faring better. Aligning education with labor demands and providing career guidance can improve graduate employability.
114 word summary
Malaysia's tertiary education faces challenges in developing human capital and driving economic growth. Despite rising graduate employability, only 60% secure jobs upon graduation, with more shifting to non-standard employment. Experienced graduates also face skills mismatch and low pay, especially diploma holders and those from low-income families. Nearly half of graduates are overqualified, and two-thirds earn below RM2,000. Disparities exist, with degree holders, public university graduates, and higher-income families faring better. Self-employed graduates also struggle, with over two-thirds earning below RM2,000. Internships and upskilling have mixed impacts. The data suggests aligning education with labor demands, addressing skills mismatch, and providing career guidance to improve graduate employability and progression, especially for TVET and lower socioeconomic groups.
435 word summary
Malaysia's tertiary education plays a pivotal role in human capital development and economic growth, but challenges persist. This report examines the career transitions and progression of Malaysian graduates using data from the Graduate Tracer Study and Graduate Career Tracking Survey.
Despite rising graduate employability rates, only around 60% of graduates secure jobs upon graduation. Trends show more fresh graduates shifting towards non-standard employment, with adverse consequences on their long-term outcomes and wellbeing. Experienced graduates also face lingering issues of skills mismatch and low pay, with certain groups like diploma holders and those from low-income families experiencing these challenges more acutely.
The analysis reveals significant challenges faced by Malaysian graduates in transitioning from education to the workforce. Nearly half of graduates are overqualified for their jobs, and two-thirds earn starting pay below RM2,000 despite higher education attainment. Disparities exist across subgroups, with degree holders, public university graduates, and those from higher-income families faring better in employment outcomes.
Experienced graduates have higher employment rates, more stable jobs, and better salaries compared to fresh graduates. However, overqualification remains a persistent issue, with 40% of the 2018 cohort and 36% of the 2010 cohort working in roles below their qualifications. TVET graduates face more challenges, with higher overqualification and lower salaries.
The Malaysian government has introduced various policy frameworks to promote entrepreneurship and self-employment among graduates. However, over two-thirds of self-employed fresh graduates earn below RM2,000 monthly, indicating difficulties in escaping the poverty cycle. Entrepreneurs and freelancers face diverse challenges that require tailored support.
Internships and apprenticeships play a key role in enhancing graduate employability, but their impact is mixed. Upskilling and reskilling through further studies or training programs is common, but accessibility is a challenge.
The report examines the relationship between labour supply and demand of tertiary-educated talents in Malaysia. Key findings include inadequate high-skilled jobs, with the number of tertiary-educated workforce exceeding high-skilled jobs by twofold, and weak linkages between labour demand and supply contributing to persistent skills mismatch and low pay among graduates.
The data suggests a need to better align education and training with labor market demands to improve graduate employability and career progression, especially for TVET graduates and those from lower socioeconomic backgrounds. Disparities based on gender, family income, and study field also highlight the need to address these imbalances and support the career development of skilled talents.
The analysis emphasizes the importance of policies and programs that support graduates in securing quality first jobs, as this can have lasting effects on their long-term career and earnings potential. Addressing skill mismatches and providing career guidance are crucial to improving graduate employment outcomes in Malaysia.
2011 word summary
Tertiary education plays a pivotal role in Malaysia's human capital development and economic growth. However, challenges persist with a growing number of graduates accepting employment not commensurate with their qualifications or resorting to non-standard work. This report examines the career transitions and progression of Malaysian graduates using data from the Graduate Tracer Study and Graduate Career Tracking Survey.
Despite rising graduate employability rates, only around 60% of graduates secure jobs upon graduation. Trends show more fresh graduates shifting towards non-standard employment, with adverse consequences on their long-term outcomes and wellbeing. Experienced graduates also face lingering issues of skills mismatch and low pay. Certain groups, like diploma holders and those from low-income families, experience these challenges more acutely.
Government interventions have facilitated graduates' transition, but existing policies fall short. Recommendations include improving employment outcome measurement, strengthening active labour market policies, promoting social protection, developing entrepreneurial ecosystems, and accelerating demand-side initiatives. Synergy between education institutions, industry, and government remains pivotal in shaping the future of work for Malaysia's skilled talents.
The transition from education to work can be challenging for fresh graduates. Analysis of graduate employability data from 2010-2021 reveals several key trends:
The overall graduate employability rate has improved, reaching 84.8% in 2021. However, less than two-thirds of graduates are employed soon after completing their studies, with the remainder furthering studies, upskilling, or waiting for job placement.
The share of graduates in non-standard employment, such as temporary/contract work and self-employment, has increased significantly, raising concerns about job security and career progression. Graduates in technical fields like engineering have higher employment rates, while those in agriculture and science face more difficulties.
Skills mismatch is a growing issue, with over 48% of graduates working in jobs that do not match their qualification level. Overqualification is more prevalent among fresh graduates, potentially impacting their long-term career prospects. Addressing these challenges requires enhancing the quality of graduate employment and better aligning education outcomes with labour market needs.
The analysis reveals significant challenges faced by Malaysian graduates in transitioning from education to the workforce. Nearly half of graduates are overqualified for their jobs, and two-thirds earn starting pay below RM2,000 despite higher education attainment. Disparities exist across subgroups - degree holders, public university graduates, and those from higher-income families fare better in employment outcomes compared to diploma holders, private university graduates, and low-income graduates. The prevalence of skills mismatch and low wages persists, undermining the returns on investment in higher education. Addressing these issues requires multi-pronged approaches, recognizing structural shortages in high-skilled jobs and the need for targeted interventions to improve employment quality, particularly for disadvantaged graduates. Examining long-term career progression provides deeper insights to inform policies that can foster a productive, inclusive, and sustainable labour market for skilled talents in Malaysia.
The analysis examines the career progression of experienced Malaysian graduates, focusing on employment status, quality of employment, and demographic factors. Key findings include:
Experienced graduates have higher employment rates, more stable jobs, and better salaries compared to fresh graduates. However, overqualification remains a persistent issue, with 40% of the -2018 cohort and 36% of the -2010 cohort working in roles below their qualifications.
Graduates with degrees fare better than diploma holders, with higher employment rates, lower overqualification, and higher salaries. Public university graduates also have slightly better outcomes than private university graduates.
TVET graduates face more challenges, with higher overqualification and lower salaries compared to non-TVET graduates. Women also experience a gender pay gap, despite similar overqualification rates as men.
The analysis highlights the need to create more high-skilled jobs, improve skills matching, and provide targeted support to address persistent labor market challenges faced by experienced Malaysian graduates.
The Malaysian government has introduced various policy frameworks to promote entrepreneurship and self-employment among graduates. Key initiatives include the 12th Malaysia Plan, which aims to create a more entrepreneurial economy, and the Malaysian Education Blueprints, which focus on nurturing entrepreneurial skills. The National Entrepreneurship Policy 2030 (NEP2030) aims to improve access to finance, make entrepreneurship a preferred career choice, and create a conducive ecosystem. The Entrepreneurship Action Plan for Higher Education Institutions (EAP-HEIs 2021-2025) seeks to strengthen entrepreneurial education and collaboration. The Social Entrepreneurship Malaysia 2030 (SEMy2030) strategy focuses on boosting social entrepreneurship. Additionally, the Malaysia Digital Economy Blueprint includes initiatives to enhance employability and the regulatory framework for gig workers. These policies and initiatives demonstrate the government's commitment to fostering self-employment and entrepreneurship as alternative career paths for Malaysian graduates.
The self-employment landscape in Malaysia reveals several key insights. Entrepreneurs and MSMEs account for 97.2% of business establishments, employing 48.2% of the workforce and contributing 38.4% to GDP. However, over two-thirds of self-employed fresh graduates earn below RM2,000 monthly, indicating difficulties in escaping the poverty cycle.
Among experienced graduates, sole proprietors (43.6%) and freelancers (33.8%) make up the majority of self-employment. Degree holders and TVET graduates are more likely to be entrepreneurs, while non-TVET graduates tend towards freelancing. Freelancers face the highest dissatisfaction, with 41.5% intending to change jobs, often due to skills mismatch and low earnings.
Key challenges faced by self-employed graduates include structural issues like scalability, administrative hurdles in HR and personal difficulties in skills and networks. Targeted support through mentorship, upskilling and strengthening the entrepreneurial ecosystem could help address these barriers and improve self-employment outcomes.
Self-employment has become an increasingly popular career path among Malaysian graduates, with fresh graduates more likely to pursue entrepreneurship or freelancing compared to experienced graduates. However, self-employed graduates face diverse challenges that require tailored support.
Entrepreneurs, especially sole proprietors, need financing, mentorship, and marketing assistance. Freelancers struggle with personal marketability and lack of certification, requiring support in positioning themselves locally and globally. Over one-third of sole proprietors and freelancers lack basic social protection, highlighting the urgent need to strengthen the social security system.
More than three-quarters of entrepreneurs have never applied for government assistance, despite the abundance of programmes available. Accessibility and awareness issues surrounding these initiatives need to be addressed through a targeted approach. Strengthening the private sector by supporting self-employment can be achieved through greater financial and non-financial support, transforming sole proprietorships into sustainable employers and providing comprehensive policies for freelancers.
Internships and apprenticeships play a key role in enhancing graduate employability in Malaysia. Internships are common, with over 80% of degree holders completing them, though the impact on employment is mixed. Internships in related fields and longer durations improve job matching and high-skilled employment. However, internships do not translate to higher starting pay.
Government apprenticeship programs reach a smaller proportion of graduates, with IPTA and diploma/degree holders participating more. Apprentices gain benefits like learning new skills and expanding networks, but absorption rates into host organizations are low. Graduates' perceptions of the returns to higher education also vary, with postgraduates most likely to see relevance to their careers.
Upskilling and reskilling through further studies or training programs is common, especially among degree and postgraduate holders. However, accessibility is a challenge, with many unaware of programs or lacking time/funding. Employer-provided training benefits also differ greatly between employees and the self-employed.
The Malaysian government has implemented various policies and initiatives to promote job creation, with targets of 1.1 million new jobs by 2025 across sectors like E&E, global services, aerospace, and renewable energy. However, the proportion of high-skilled jobs created has remained below 25% of total jobs since 2010.
While total jobs have increased, the composition of job skill levels has remained largely unchanged, with around 25% high-skilled, 62% semi-skilled, and 13% low-skilled jobs. Job vacancies are predominantly semi-skilled, indicating potential mismatches between graduate supply and employer demand.
Analysis of the Beveridge curve shows the labor market was relatively healthy pre-pandemic, but the COVID-19 crisis led to a sharp drop in job vacancies. The market is gradually recovering, but optimizing efficiency requires fostering economic growth, scaling up skills development, and improving labor mobility.
Key skills in high demand include technical, problem-solving, analytical, interpersonal, and digital skills, which do not fully align with the graduate output dominated by social sciences and business.
The report examines the relationship between labour supply and demand of tertiary-educated talents in Malaysia, exploring trends, challenges, and outcomes in graduate employment over the past decade. Key findings include:
Inadequate high-skilled jobs, with the number of tertiary-educated workforce exceeding high-skilled jobs by twofold. Many graduates are employed in low- or semi-skilled jobs or non-standard employment.
Job matching efficiency has improved post-pandemic but remains inefficient, with low unemployment coupled with stagnant job vacancy growth. Weak linkages between labour demand and supply contribute to persistent skills mismatch and low pay among graduates.
Tailored support is needed for different types of graduate entrepreneurs, with financing and administrative challenges for employers versus personal skill gaps for sole proprietors. TVET graduates show more favourable entrepreneurial outcomes.
Intensified efforts are required to create more high-skilled, well-paying jobs, establish fair wage guidelines, boost job matching efficiency, and reinforce industry-academia linkages to address structural labour market issues.
The report examines the career progression of skilled talents in Malaysia. Key findings include:
Graduates are increasingly from higher-income families, with the proportion from families earning over RM5k rising from 6.3% in 2010 to 23.2% in 2021. The share of graduates from TVET programs has remained around 30%, with most coming from non-MTUN public institutions.
Overqualification is a concern, with over 40% of graduates employed in roles below their qualification level. This is more prevalent among those with postgraduate degrees and TVET graduates. Overqualification is also higher among lower-income groups.
The data suggests a need to better align education and training with labor market demands to improve graduate employability and career progression, especially for TVET graduates and those from lower socioeconomic backgrounds.
The report examines the career progression of skilled talents in Malaysia, analyzing factors such as monthly income, employment status, and economic sector. Key findings include:
Over the years, the proportion of graduates earning less than RM2,000 per month has remained high, ranging from 61% to 84%. This trend is more prevalent among younger graduates aged 15-20 and those from non-TVET institutions.
Graduates in traditional services, social services, and industrial sectors are more likely to earn lower incomes. In contrast, those in modern services and agriculture tend to have higher earnings.
The data also reveals disparities based on gender, family income, and study field. Male graduates, those from higher-income families, and those in science, engineering, and health fields generally have better income outcomes.
The report highlights the need to address these imbalances and support the career development of skilled talents in Malaysia.
The Graduate Career Tracking Survey (GCTS) provides insights into the employment experiences of Malaysian graduates over time. Key findings include:
Graduates from the 2018 cohort have higher employment rates compared to the 2010 cohort, with 63.8% and 73.4% working, respectively. However, the 2018 cohort also has a higher prevalence of overqualification at 54.8% versus 45.3% for 2010.
Graduates in high-skilled occupations like managers and professionals earn higher salaries, with over 60% of the 2010 cohort earning more than RM3,000 per month. In contrast, only 46.8% of the 2018 cohort reached this salary threshold.
Demographic factors like gender, age, and field of study influence employment outcomes and earnings. For instance, male graduates and those in STEM fields tend to have better employment and salary prospects.
The report highlights the need to address skill mismatches and ensure graduates are equipped with the right competencies to meet industry demands.
The analysis highlights the significant impact of a graduate's initial job experience on their future career trajectory. Graduates who start in standard employment have a 73.4% probability of attaining standard employment later, while those who start in mismatched jobs have only a 21.8% chance of securing a matched job later. Salary level is also crucial, with graduates who start in high-paying jobs having a 60.1% probability of earning over RM3,000 in the future, compared to just 12.8% for those who start in low-paying roles. The findings emphasize the importance of policies and programs that support graduates in securing quality first jobs, as this can have lasting effects on their long-term career and earnings potential. Addressing skill mismatches and providing career guidance are crucial to improving graduate employment outcomes.