Many Malaysian graduates are earning just enough to survive, says report

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Category: CONSUMER DIGEST
PETALING JAYA: Many Malaysian graduates are earning just enough to survive, with little to spare for saving or upward mobility, according to a new report by a labour market research group.
Future Studies Berhad said the study also dispelled the notion that tertiary education guaranteed a meaningful wage premium.

The report, titled β€œThe β€˜Gaji Cukup Makan’ Economy: When Higher Education Becomes an Economic Risk”, also finds the idea that tertiary education guarantees a better life is being increasingly challenged.

Future Studies said based on its report, the high employability rates – often exceeding over 80% – were misleading as it included all forms of employment, regardless of skill match or wage level.

β€œIn reality, over 70% of employed graduates are in semi- and low-skilled roles, and more than 65% of degree holders earn below RM3,000 monthly,” the report read.

It said its findings highlighted a serious mismatch between qualifications and job roles, and a clear erosion in the returns on higher education investment.

β€œThe mismatch in Malaysia leads to deeper economic vulnerability, limiting upward mobility and reducing the incentive to pursue higher education, particularly among lower-income groups.”

Future Studies said the decision to pursue higher education becomes increasingly risky, especially for low- and middle-income households who are burdened by rising education costs but see limited wage rewards.

The report also pointed to several root causes behind the slow wage growth, ineffective pre-employment and weak skilled demand from the private sector, which it labelled as a β€œcrisis”.

β€œThese factors create a compressed and delayed wage trajectory, where graduates struggle to earn more than non-graduates, especially early in their careers.”

To address the problem, the report calls for major reforms in education and employment policies, including a shift away from misleading graduate employability figures and restructuring of internships to bridge the education-employment gap

Other recommendations include pushing for industrial upgrading or job redesign and introducing advisory wage guidelines to address wage compression.

It also proposes bold reforms and a β€œholistic policy ecosystem” that aligns education planning, labour market demand and wage outcomes into a cohesive outcome-based national strategy.