KUALA LUMPUR, Jan 16 — Malaysia was ranked 33 out of 83 countries in the QS World Future Skills Index which evaluated the readiness of higher education systems to meet the evolving demands of the job market.

In its press release, QS underlined that Malaysia appeared to provide skills at a rate that potentially outstripped the pace of economic and industrial innovation.

"This transformation gap reflects a significant reserve of untapped talent due to a lack of suitable jobs or growing industries,” the press release stated.

Notably, with a total score of 69.8 out of 100 across four indicators — academic readiness, future of work, skills fit and economic transformation — Malaysia performed best in academic readiness and worst in economic transformation.

Malaysia’s poor performance in the "economic transformation” category with a score of 35.4 over 100 indicated its lack of readiness to leverage the next wave of skills-led industrial growth.

In contrast, South Korea earned a perfect score of 100 in the economic transformation category by reshaping its economy and managing the decline of traditional sectors.

The "economic transformation” category measured whether a country has the infrastructure, investment power, and talent available to transition to industries driven by Artificial Intelligence (AI), digital transformation, green technologies, and high-skilled work, using data from the World Bank Group, Unesco Institute for Statistics and the Education Policy Institute.

"Bridging this gap requires targeted economic policies, increased research investment, and strong industry partnerships to create opportunities and effectively utilise this potential, driving innovation and sustainable growth,” the press release stated.

This is despite Malaysia having a higher education system that is good at supporting high-quality learning and skill development in fields that are most relevant to the future workforce, scoring 91.2 for the academic readiness category.

Malaysia ranked fourth in Asia for academic readiness with Hong Kong as the best performer in the region scoring 98.6 for the category.

QS examined the number of universities, how well it performed in the QS World University Rankings by Subject, the job market and how the educational system was aligned with future demands in tandem with population size to calculate academic readiness.

Malaysia also did well in the "future of work” indicator which measured the job market’s preparedness to recruit high-demand skills like digital, AI, and green skills, in the future with a score of 88.6.

"This reflects the country’s advanced job market, ripe with innovation across AI, Digital and Green industries with abundant career opportunities in these spaces,” the press release said.

The report said these skills were becoming increasingly important as economies transition towards technology-driven and sustainable industries.

Meanwhile, a score of 64 was given when it measured how well the education system aligns with the needs of industry and employers through its "skills fit” category.

"In the QS World Future Skills Index, the average Skills Fit score is just 58.8, showing there is still room for higher education sectors globally to improve their alignment between industry and academia. 85 per cent of countries have a Skills Fit score below 80,” the report stated.

This category was assessed by determining the gap between what employers find important and their level of satisfaction with the skills provided by graduates.

The 2025 QS World Future Skills report also listed the growing and declining skills globally:

Top 5 Growing AI Skills

1. Machine learning tools

2. Data science, analytics & data visualisation

3. Natural language processing & chatbot development

4. Cloud computing, encryption & infrastructure

5. Data engineering, big data tools & data modelling

Top 5 Declining AI Skills

1. Legacy AI & machine learning libraries

2. Legacy NLP & voice recognition tools

3. Older cloud & computing platforms

4. Statistical and data analysis tools & knowledge-based systems

5. Human-machine interface software & robotics

Top 5 Growing Digital Skills

1. Cloud computing & infrastructure inc. Amazon EKS/ Microsoft Power Automate

2. AI & machine learning

3. Web, application and chatbot development

4. Data science & analytics

5. Security & compliance inc. AWS Security

Top 5 Declining Digital Skills

1. Programming languages & frameworks inc. Jython

2. Enterprise software & CRM systems inc. Sage Simply Accounting

3. Data & database management

4. Testing, monitoring & automation tools

5. Graphics, multimedia & design software inc. Adobe Social

Top 5 Growing Green Skills

1. Environmental science, conservation & climate change mitigation

2. Agriculture, agroforestry & soil ecology

3. Water & hydrology management inc. hydrological modelling software

4. Renewable energy, geothermal heating & carbon management

5. Wildlife & biodiversity conservation

Top 5 Declining Green Skills

1. Legacy environmental tools & software inc. Envirodata Solutions

2. Agricultural & crop management practices inc. crop rotation

3. Garden design & ecological practices

4. Solar architecture & energy efficiency tools

5. Animal control & livestock management