Skills mismatch causing high youth unemployment, say experts

 

Subjects taught in local universities could be outdated as technology is fast changing, says HR consultant Srithren Krishnan. (Facebook pic)

PETALING JAYA: While Malaysia’s labour market is projected to remain stable in 2024, concerns persist over the high youth unemployment rate, which has remained at 10.6% for the fourth consecutive month in February, affecting over 306,600 people.

For those in the 15-24 years age group, the failure to land jobs is primarily due to a skills mismatch, said an economist and a HR consultant.

Yeah Kim Leng, economics professor at Sunway Business School, said a significant factor contributing to the problem is the mismatch between skills demanded by industries and those imparted by local universities.

He attributed the high unemployment rate among youth in the country to both “demand- and supply-side factors”.

Yeah Kim Leng.

“Elevated youth unemployment suggests that the country’s human resources are not being fully utilised,” Yeah told FMT Business.

He said strong competition among job-seekers mean the limited vacancies in fields such as engineering, science, accounting and financial analysis tend to be filled by graduates from top-tier local and foreign universities.

In contrast, Yeah said labour intensive sectors such as food farming, agriculture, fisheries, construction and low-end manufacturing, which offer numerous employment opportunities, are predominantly filled by imported labour.

This is due to the reluctance of local youths to take such jobs because of low pay and demanding working conditions, he said.

To address the mismatch in the labour market, Yeah proposed the introduction of more upskilling and skills-matching schemes for youths through public-private partnership programmes.

“The success of youths in entering the workforce and finding employment with decent wages and those with an entrepreneurial spirit will contribute to a more dynamic economy, and a prosperous society,” he said.

University courses outdated?

Meanwhile HR consultant Srithren Krishnan pointed to a vast mismatch between what young people learn and what modern jobs require.

“Maybe the subjects taught in the universities are outdated as technology is changing at a fast pace,” he told FMT Business.

He said the government should mandate year-long internships for undergraduates to ensure that they meet industry standards,.

“Additionally, industries should come forward to collaborate and establish labs in universities to produce jointly researched products that emphasise high-technology applications.”

Srithren also suggested the government disallow labour-oriented industries from operating, and emphasise AI (artificial intelligence)-driven work processes instead.

A recent report by the Institute for Strategic Analysis and Policy Research said Malaysia, like other South East Asian and Pacific nations, is wrestling with youth unemployment.

The study said youth unemployment in Malaysia is “a complex issue”, influenced by factors such as the overlooked urban youth segments, aggregate demand and a structural mismatch in the labour market.

Kenanga Investment Bank has projected that Malaysia’s labour market will remain stable in 2024, with the average unemployment rate at 3.2%, consistent with the 2023 rate of 3.4%. - FMT