KUALA LUMPUR, Nov 7 — While a university education is typically regarded as a means to secure a better future, a report has shown that Bumiputera graduates also find it difficult to get a job.

Actually, they have a higher unemployment rate than their peers of the same ethnicity who do not have a tertiary education.

The Ministry of Finance’s Economic Outlook 2019 report examined the unemployment rate among Malaysians of different education levels, based on the Department of Statistics Malaysia’s (DOSM) 2017 figures.

The report noted that Bumiputeras with tertiary education recorded the highest unemployment rate in 2017 at 4.6 per cent, far higher than Bumiputeras who only had secondary schooling (4 per cent), primary education (1.9 per cent), while Bumiputeras with no formal schooling recorded the lowest unemployment rate at 1.5 per cent.

In comparison, those without formal schooling recorded the highest unemployment rate within the ethnic Chinese community (3 per cent) and ethnic Indian community (6.9 per cent). For both ethnic groups, those who graduated from universities had the second highest unemployment rate at 2.9 per cent (Chinese) and 5.5 per cent (Indians).

Those categorised as "Others” had the highest unemployment rate among those with secondary education (8.6 per cent), while those with tertiary education came in second at 5 per cent.

According to DOSM’s Labour Force Survey Report Malaysia 2017, tertiary education refers to those whose highest level of education is above Form 5, while secondary education refer to those with education from Form 1 to Form 5 only. Primary education would be from Standard 1 to 6, while those with no formal education never attended school in institutions providing formal education.

Based on Malay Mail’s calculations using figures from DOSM’s report, the total number of unemployed Malaysians with tertiary education for the year 2017 is 174,100, inclusive of 17,700 STPM graduates, 19,000 certificate holders, 70,800 diploma holders and 66,600 graduates with a degree (Bachelor, Masters or PhD). Altogether, tertiary-educated Malaysians accounted for 34.6 per cent of the 463,700 unemployed Malaysians in 2017, just below those who are SPM graduates at 43 per cent.

The Economic Report 2019 explained that this scenario of high unemployment for tertiary-educated Malaysians which appears to buck conventional wisdom is due to a mismatch between industrial needs and graduates’ skills.

"The high unemployment rate among those with tertiary education including graduates, in particular, Bumiputeras (4.6 per cent or 129,000 persons) and Indians (5.5 per cent or 14,500 persons) is mainly due to skills gap,” the report said.

"Furthermore, a survey conducted by the World Bank and Talent Corporation in 2014 found that 90 per cent of companies believe that university graduates should have more industrial training by the time they graduate.

"However, the study also indicates that less than 10 per cent of companies had experience in developing curricula or programmes with universities,” the report said, citing a report published by Bank Negara Malaysia in 2017.

The report said, however, that the federal government had sought to encourage companies to help university graduates improve their skills while on the job, with a total of 125,986 graduates assisted through such training programmes as of August 31.

"Currently, 539 companies (514 private companies and 25 government-linked companies) including Maybank Group, CIMB, Axiata, Celcom, Huawei and Intel are working closely with the Ministry of Education to improve graduate employability,” it said.

Youths

The report similarly attributed the problem of insufficient skills or education when commenting on Malaysian youths (between the ages of 15 to 24) recording the highest unemployment rate in 2017 among all age groups at 13.2 per cent, further noting that youth unemployment is also a global concern.

The total youth unemployment rate is based on the unemployment rate among the 15-19 age group (18.7 per cent) and 20-24 (11.9 per cent) as of 2017 DOSM figures.

Among youths aged 15 to 24, the ethnic group categorised as "Others” had the highest unemployment at 17.7 per cent, followed by Indians (15.5 per cent), Bumiputeras (14.1 per cent) and Chinese (8.3 per cent).

The report noted that many job vacancies were for low- or semi-skilled work which was less preferable and "not suitable for fresh graduates”, adding that the bulk or 86.9 per cent of the 1.4 million vacancies available in 2017 were jobs that required only primary education, while 8.4 per cent were for semi-skilled jobs.

In comparison, only 4.7 per cent or 64,402 job vacancies in 2017 were skilled jobs requiring tertiary education.

The Economic Outlook 2019 said a lack of work experience also contributed to youths being unemployed, noting that this was among the qualities most sought after by employers.

Zoom out

But when examined as a whole, Malaysia’s overall unemployment rate is at 3.7 per cent as of 2017.

When broken down according to ethnicity, those in the "Others” category had the highest unemployment rate within their own ethnic group at 6.6 per cent, followed by Indians (4.7 per cent), Bumiputeras (4 per cent), and Chinese (2.4 per cent).

The Bumiputera group made up the majority or 72.5 per cent of the unemployed 463,700 Malaysians in 2017, with 336,400 Bumiputeras unemployed in the DOSM report.

This was followed by the Chinese at 77,100 unemployed or 16.6 per cent of the unemployed Malaysians, and Indians at 43,300 (9.3 per cent) and Others at 6,800 (1.5 per cent).

According to DOSM’s 2017 statistics, the Bumiputera is the largest ethnic group at 68.8 per cent of the 28.7 million Malaysians, followed by Chinese (23.2 per cent), Indians (7 per cent) and those from other ethnic communities at one per cent.

The report concluded that the government will pursue interventions such as identifying skills required by companies and mainstreaming technical and vocational education and training (TVET).