5 reason

The increasing unemployment rate among the graduates in Malaysia is a worrying trend. For many years, the issue cropped up again and again, made the news headlines, and even hit the parliament.

The days have passed when a degree scroll can become your automatic passport to employment. Higher education is no longer a symbol of career success. This may sound painful for graduates but let’s face it. It is reality, no matter how harsh it may appear.

In July 2006, The Sun newspaper reported that the unemployment rate of public universities has reached a staggering 70%, whereas the private institutions recorded 26% and foreign graduates 34%. Out of the 70%, the highest unemployment was contributed by the following statistics:

1. Universiti Teknologi MARA, UiTM – 3,278 (16.2%)
2. Universiti Utara Malaysia, UUM – 1,532 (7.6%)
3. Universiti Teknologi Malaysia, UTM – 1,147 (5.7%)
4. Universiti Kebangsaan Malaysia, UKM – 971 (4.8%)
5. Universiti Putra Malaysia, UPM – 919 (4.5%)

The situation was somewhat different before the 1997 crisis when Malaysia was having a vibrant employment and graduates were in high demand. But those were the good old days and things are no longer the same today. Is the job market getting more competitive, or it is the job seekers and graduates are actually unmarketable these days? Can we blame it entirely on education?

Perhaps we can take a look at some contributing factors:

1. Economy

The changing of the economic structure and landscape is a probable cause for the rise in the unemployment. For many years, the manufacturing has been the strongest sector in the country until it is now being progressively replaced by the services sector. The services sector requires people who do not only possess the right technical knowledge, but also those who possess the right soft skills – interpersonal, communication, wisdom, maturity and are business oriented. Now, getting graduates with that kind of quality is a tough endeavor these days. It is even hard to find graduates who can speak moderate English.

Additionally, unlike the manufacturing sector, a company providing services would not require a large number of staff to be employed. Statistics show that between 2006 and 2007, the country’s manufacturing employment grew by 3%, from 3.244 million workers, to 3.347 million. The business services sector employment, on the other hand grew by 2.6%, from 0.771 million, to 0.791 million.

Now, where GDP (Gross Domestic Product) growth is concerned, the manufacturing growth recorded 3.1% whereas services tops the chart with a thumping 9% growth.

In English, this means that while the employment growth of services sector is lower compared to manufacturing, it is actually contributing to much higher economic achievement. Get the picture?

Malaysia Unemployment: Why Fresh Graduates are Unemployed in Malaysia2. Quality of education

It seems that every year the country produces more and more brilliant students. This is evident with the increasing number of straight A students in SPM. It is also easier to find degree holders with first class honors. Surely, this is a good yardstick of the graduate’s quality. Is it? Not so, it seems.

My own experience with graduates – not once, but many times – has convinced me that today’s academic achievement has little to do with how well you can excel in the working world. I used to be short listing 4-5 first class graduates for an interview and in the end rejected them all, and hired a second class student instead. It seems that the country is blessed with institutions highly capable to produce low quality, academic achievers. This statement may not bode well with some of the institutions out there but this should be taken as a challenge, not a mockery.

3. Choosy job seekers

I remember when I first got my first job in Penang, I did not have a permanent place to stay as my hometown was back in Terengganu. I was temporarily staying in an old friend’s house. I also did not own any car or motorbike. When asked by my boss how I was going to report for my first day of work, I told him that I would be using the company’s bus.

As the buses were used to transport the production operators, my boss laughed at my face and told me that I would be the first engineer in the history of the company to have used bus coming to work. I got a new place to stay, and my own car only after few months working with the company. The most interesting part is that, I didn’t even ask about the salary when I accepted the job!

But how different it is today. Nowadays, candidates are expecting job offer to come with a package – a good pay, convenient working location, no shift, no work beyond 6pm and so on, with everything handed in a silver platter. Job seekers have come to me to complaints and made admissions that shocked me till no end.

They are not willing to drive from Sentul to Cyberjaya because “It’s very far and I do not want to spend this much money on toll everyday”. Another was not willing to take the LRT from Cheras to Masjid Jamek because “too many people in the train and this will make me stressful.” To date I am yet to come across a job seeker that will tell me, “I’m so glad with this opportunity. As for the transportation, accommodation and other matters, no worries, I will settle them from my end here. I am just glad I don’t need to rely on my parents for pocket money anymore.” Will you be one?

4. Lack of guidance

Blaming the graduates themselves for the whole predicament is not entirely right either. After all, they are products of a flawed system. Majority of them are oblivious to the expectation from them in the employment market. Upon graduation, they become babies again, not ready to face the real world. The supposedly days of liberation suddenly becomes the days of uncertainty. This happens due to obvious discrepancy between the education and the employment – i.e. study is study and work is work. This gap needs an immediate bridging.

While organizing a career fair and sending penultimate students for industrial placement are commendable effort, these are just not enough. Graduating students need a closer feel to the employment world. The career office should be their second home. If that also means bringing executives, engineers and managers into the university to give practical advice to the students, by all means do it. Universiti Teknologi Petronas, UTP has pioneered this move, which won a praise by The Star reader today.

I must take my hat off to University Technology Petronas (UTP), which has formed an Industry Advisory Panel (IAP), and invites professionals from the industry to review their curriculum and suggest areas for improvement. UTP is serious about this and has implemented many of the suggestions introduced by its IAP.

UTP also has an adjunct lectures series where professionals are called in to give lectures to the undergraduates. I think these are good initiatives that other universities would do well to emulate.

- Shyam Lakshmanan, The Star, 17 April 2008

5. Choosy employers

There is no need for long explanation here. As Zaid Ibrahim (that new MP) put it in his book, In Good Faith, it’s catch-22 situation – if the employer is putting ‘working experience’ as a pre-requisite to get a job, when is the fresh graduates going to get their first job?