Young and jobless Malaysian grads a RM500m strain on taxpayers

KUALA LUMPUR, Oct 9 — Bad work attitudes coupled with poor communication skills topped by unrealistic pay demands are the three biggest grouses employers have in turning down fresh graduates, Southeast Asia’s top online recruitment firm Jobstreet has found — suggesting that the nearly RM500 million the Najib administration has proposed to spend on jobless youths may not be enough to enough to make them marketable.

A whopping 64 per cent of employers surveyed by Jobstreet said they rejected the fresh graduates because the job seekers had asked for unrealistic remuneration during the interview, the job search agency told The Malaysian Insider in a recent email inquiry.

File photo of Home Minister Datuk Seri Hishammuddin Hussein with university student leaders after a lunch early this year. Many graduates remain unemployed due to their poor command of English.

Another 60 per cent said they were forced to turn down the graduates due to bad attitude, personality and character. 

And more than half of 571 human resource managers polled by Jobstreet in a November 2011 study said they were unable to hire the graduates due to the job seekers’ poor communication skills, notably their lack of command in using English — which remains the business lingua franca worldwide.

“Many are currently unemployed because the courses they studied for at university do not have a wide market. In fact, many graduates do not know what they want to do after they finish their studies,” said Sarafarina Azam, 30, an assistant human resource manager with an international insurance company.

In his Budget 2013 speech presented in Parliament last month, Prime Minister Datuk Seri Najib Razak had mooted setting up a Graduate Employability Taskforce with an allocation of RM200 million to strengthen the employability of jobless graduates under a Graduate Employability Blueprint by the end of this year.

He also announced an additional RM440 million to be allocated for the Skills Development Fund Corporation (PTPK), to provide loans for trainees to undergo skills training. 

The government will also set up a New Entrepreneur Foundation (NEF) with a start-up of RM50 million as part of its efforts help young ICT entrepreneurs. The NEF will be the platform to provide training and guidance programmes.

A separate Young Entrepreneurs Fund will be set up and will be given RM50 million by the SME Bank to hand out as soft loans to jobless youths aged 30 and below, providing a subsidised two per cent interest rate for loans up to RM100,000 with a seven-year repayment period.

The proposals are seen to complement the National Education Blueprint 2013-2025 with the aim to be in the top third of the Programme For International Student Assessment (PISA) test within the next 13 years. The country is currently ranked in the bottom third.

The education blueprint comprises 11 strategic “shifts” to inculcate six attributes in children — knowledge, thinking skills, leadership, bilingual proficiency, ethics and national identity.

Yet within its recent Budget 2013, the Barisan National (BN)-led government cut its education budget drastically from RM50 billion in the last budget to RM38.7 billion, raising doubts about the likely success of the educational blueprint in addressing the nation’s flagging education standards.

The opposition coalition Pakatan Rakyat (PR) called for abolishing the National Higher Education Fund (PTPTN) to wipe out PTPTN debts, drawing criticism that such a move would backfire as it would give students a sense of entitlement and increase their reliance on the government. 

Analysts have also suggested that Malaysia’s dream of boosting its education standards through an ambitious overhaul of the national school system will not happen as long as politicians continue to be involved in drawing up its policies.

There are currently 20 public universities in Malaysia, including the International Islamic University of Malaysia (IIUM), Mara University of Technology (UiTM) and Universiti Malaysia Sabah. 

Over the past 20 years, the number of private higher education institutions has also increased to a total of 60 nationwide, such as HELP University, UCSI University, Tunku Abdul Rahman University and many more.

Jobstreet said the government’s proposal to spend some RM500 million on training fresh graduates and provide other incentives to raise their employability was welcome but stressed that practical training courses needed to be strengthened and, more significantly, the education system needed to be revamped in order to produce quality graduates who possess the necessary skills and knowledge in line with the job market.

Malaysia’s mushrooming local higher education institutions churned out a total 184,581 graduates last year according to the latest statistics released on the Higher Education Ministry’s website. Of that figure, 44,391 people or 24 per cent are unemployed.

According to data from the ministry, the most number of unemployed graduates are those who studied arts and social sciences (19,784), followed by those from a technical field (12,321). But in comparison to their peers from the same field, science students have the highest unemployment rate — making up 29.5 per cent of jobless graduates.

The ministry’s statistics also show that job-seekers armed with only a diploma (17,095) are more successful in landing a job than those who holding a bachelor’s degree (21,248).

And as many as 6,852 graduates hail from Selangor, Malaysia’s richest and most-industrialised state, forming the country’s biggest group of jobless degree-holders, followed by Kelantan (5,232), which ranks among the poorest in the 13-state nation.

In a separate survey involving 1,830 fresh graduates, Jobstreet found nearly a third of graduates blamed their persistent jobless state on stiff competition.

Mohd Al-Amin Omar graduated from Universiti Sains Malaysia three years ago with a distinction in industrial technology and has been unsuccessful in securing a permanent job since.

The 27-year-old has been working as a technician to support himself.

“For three years I have been looking for jobs and I have tried various agencies but have failed up to now. After three years, I feel like quitting and am fed up of looking for a job,” he said.

He blames his failure to secure a full-time position on the limited market for his field of study and some employers whom he says refuse to pay remuneration suitable for his university qualification.

“Every year graduates complete their studies but the industry has not expanded. Look at the ads in Jobstreet, Jensjob and other job recruitment agencies, how many vacancies are there for those qualified in this field?” Mohd Al-Amin asked.

He is not alone.

For Desiree Nair, an accountancy and management graduate from Segi College, the pressure of being unable to secure a permanent job has been building over the last two years.

“The pressure is there, but I’m still hanging on. I’ve had four interviews since June but until now I have not been able to find a stable job,” the 25-year-old said.

Unlike Mohd Al-Amin, Nair believes she was passed over due to stiff competition and the racial attitudes of some employers.

“The market for my field is wide, only competition is tough which I have to face especially with those who studied abroad for the same course.

“Apart from that, I am also disappointed with some employers who act racial. In their advertisements, they list all kinds of criteria like language and race — how can I get a job if it’s like this?” Nair asked.

An estimated 76,200 graduates are currently unemployed because the majority do not possess adequate job-hunting skills and are too dependent on others for information on available jobs, Deputy Human Resource Minister Datuk Maznah Mazlan was reported as saying in May. 

She was reported by state news agency Bernama as telling the Dewan Negara that 77.14 per cent of 1,994 respondents in a study by the Labour Department said they needed a mentor or coach to guide them on ways to find a job.

Malaysia is seeking to make the leap into the ranks of a high-income nation status in the next eight years.

Analysts have also warned the ambitious nation still stuck in the middle-income trap to brace for a significant slowdown here due to rising linkages with top trade partners including China, the world’s second-largest market, which economists say is headed for a sixth consecutive quarterly drop in growth, with worse to come.

Malaysia is among the most vulnerable Asian economies should a “perfect storm” of a disorderly debt default in Europe, a slowdown in China and the US, and rising tensions in the Middle East materialise, strategy research house Roubini Global Economics (RGE) said in a report in July.

RGE, best known for its founder “Dr Doom” Nouriel Roubini who predicted the collapse of the US housing market and the 2008 global financial crisis, said that Malaysia had the highest exposure to a pullout of capital as its eurozone and US bank claims amount to more than 25 per cent of GDP.

The World Bank also urged Malaysia earlier this year to expedite reforms such as subsidy cuts and broadening the tax base, key initiatives that have stalled ahead of an impending federal election, if it wants to achieve Putrajaya’s target of being a high-income economy by 2020.