A labour economist has expressed concern over whether Malaysia is creating enough semi-skilled jobs to meet the demands of an increasingly educated workforce.

Institute of Labour Market Information and Analysis (Ilmia) adviser Lee Chee Sung said while new jobs are still being created, a diminishing share of those job openings are for semi-skilled labourers.

Between 2010 and 2016, the share of new semi-skilled positions in the labour market had fallen steadily from 61.0 percent to 59.7 percent, he said. The total number of jobs created in 2010 was 11,900, and 14,164 in 2016.

“A lot of jobs are being created in the (skilled labour category), but what is worrisome is that the jobs for the semi-skilled are not doing so well. Not so many jobs are being created (in the semi-skilled category).

“Remember, in our labour force, the people who are coming out of our technical vocational education and training (TVET) colleges are (semi-skilled) workers, and there are a lot of people coming out – 100,000 people are always coming out.

“So, we need to find jobs for them,” he told the audience at the Malaysian Institute of Economic Research’s (MIER) national economic briefing in Kuala Lumpur today, which is themed “Youth unemployment and job creation”.

Over the same period, positions for unskilled occupations increased from 11.4 percent to 13.8 percent in 2015 (out of 14,068 jobs created that year), before dipping to 13.0 percent in 2016.

The proportion of new skilled jobs, meanwhile, fell from 27.6 percent to 24.6 percent in 2014 (out of 13,853 jobs created that year), and then climbed steadily to 27.3 percent in 2016.

Lee said the number of skilled jobs created is in line with the government’s goal of Malaysia achieving high-income status, which would entail bringing the proportion of skilled labourers to around 30 or 35 percent.

The figures are based on Department of Statistics’ (DOSM) Labour Force Survey (LFS).

Difficult to find talent

Meanwhile, Lee said Malaysia’s overall unemployment rate had been steady at around three or four percent since 2000. Since 2014, however, the rate at increased steadily from 2.9 percent to 3.5 percent this year.

This had given rise to concern among some that youths are taking the brunt of the increased unemployment, as the unemployment rate for youths (those between 15 and 24 years old) is nearly three times that of the overall unemployment rate at 10.5 percent

This means that youths make up about half of the unemployed, he said.

However, Lee said the proportion of youths who are unemployed had in fact changed little over the years, nor has the proportion of unemployed adults (those between 25 and 55).

“So this concern may be overrated, but obviously we don’t want to not take any action about it,” he said.

Compared to other countries, Lee said the global youth unemployment rate in 2012 was 13 percent, and the figure was 11 percent for the Asia-Pacific region.

In 2015, Thailand’s youth unemployment rate was 3.4 percent, and Vietnam’s was 6.3 percent. On the other hand, Indonesia’s figure was 21.6 percent, and the Philippines was 15.0 percent.

When it comes to qualifications, Lee said 20 percent of unemployed youths are degree holders, while 14 percent hold a diploma or a certificate. A further 10 percent hold either an SPM or SPMV certificate.

The figures are for 2011, but Lee said the proportion is not expected to have changed much.

By field of study, Lee said 24 percent of the unemployed youths had studied the arts and humanities, while 20 percent had studied basic science subjects. A further 19 percent had studied science, math, and computing subjects.

Quoting the Grant-Thornton International Business Report 2013, Lee said 62 percent of Malaysian employers had complained it is difficult to find talent, and 48 percent said this difficulty is making it hard for their company to grow.

Based on figures from the World Bank and TalentCorp in 2014, Lee said the most frequent complaint from employers was that local university graduates (81 percent of respondents), followed by creative or critical thinking skills (56 percent), and analytical skills (51 percent).

In comparison, only 20 percent complained the lack of literacy skills, and another 20 percent complained the graduates' inability to work as a team. A further 13 percent said they lacked numeracy skills.

The employers had said that the quality of teaching needed improvement, and the university curriculum needed to be brought in line with industry requirements and provide more industry training.

However, Lee pointed out that the employers themselves were not taking the initiative to engage with universities on the skills mismatch.

He also lamented that many of Malaysian industries are small and medium enterprises (SMEs), many of which feel they do not have time to entertain DOSM's surveys.

This had hampered the department's efforts to collect data enterprise surveys, as the SMEs would rather pay a fine than to complete the survey.

On the other hand, he said the DOSM does not collect data on the youth proportion not in employment, education, or training (NEET rate) in its annual LFS surveys.

Such data would have been useful in understanding youth unemployment if it had been available, he said.