RETRENCHED skilled workers and new graduates are competing for the same jobs in an increasingly competitive labour market that is not able to create enough high-skilled jobs, job seekers said.

This is forcing people like Mohamad Zahrin Roslan, 31, who has years of experience in a technical field, to accept a lower salary as many job openings are targeted towards fresh graduates.

Zahrin, who worked in the oil and gas sector, has been jobless for the past four months. During the period, he sent out 100 job applications but only received five replies. Not one of the replies resulted in an interview.

His seven years’ experience was not an advantage, he said, when met at a job fair in Kuala Lumpur recently.

“The competition is just too high these days,” said Zahrain, who was retrenched after his company was forced to restructure because of a dampening oil and gas sector.

Data from Bank Negara Malaysia (BNM) and the Malaysian Employers Federation (MEF) show that the economy has not been able to produce enough high-skilled jobs to keep up with the high number of fresh graduates produced each year as well as skilled workers who are retrenched.

In its 2018 report, Bank Negara said between 2010 and 2017, the growth of high-paying, high-skilled jobs which required some form of tertiary education was lower than that of low-skilled, labour-intensive jobs.

In its supplementary report on wages, BNM revealed that high-skilled jobs grew by 2.8% in that period as compared with low-skilled jobs at 4.6%.

During the same period, the number of diploma and degree holders in the labour force increased by an average of 173,457 people per year, the report said.

This is much higher than the net number of high-skilled jobs created at 98,514 annually.

“This suggests that the economy has not created sufficient high-skilled jobs to absorb the number of graduates entering the labour force,” BNM said.

At the same time that these new graduates are entering the job market, MEF said last year, 21,000 workers were retrenched, half of them in the Klang Valley.

This year, MEF expects the number of retrenchments to increase to 30,000 but this figure has been disputed by the Human Resources Ministry.

The economy grew by 4.7% in 2018, while the number of jobs grew by 2.5% compared to 2017, said BNM.

Economic growth was driven by private sector expenditure, particularly private consumption which grew by 8.1%, the fastest since 2012.

The services sector grew by 6.8%, the highest since 2011, as better consumer sentiments and favourable labour market conditions spurred spending, particularly during the GST tax holiday period, BNM said.

The manufacturing sector expanded by 5% supported primarily by a continued expansion in the electrical and electronics (E&E) cluster. The construction sector recorded a moderate growth of 4.2% due to weaknesses in the property segment.

BNM’s supplementary report on wages revealed that between 2010 and 2017, the construction and wholesale retail trade, food and beverage and accommodation industries expanded faster than most other sectors. However, wages in these sectors are at the low levels.

Overqualified but earning peanuts

Retrenched workers and fresh graduates able to find jobs are forced to settle for lower pay and work in fields they did not study or work in.

This was experienced by Zito Azran Abdul Rahim, who has 18 years’ experience as a graphic designer but who lost his job after his company closed shop last October.

Zito was also at the job fair handing out resumes and trying to meet new employers but many did not want to meet his salary request.

“There are jobs and I have been called by about 12 times. But the salaries are too low and did not commensurate with my experience,” said the 40-year-old.

“But there are people who are forced to accept lower pay because they have no choice. This is not something that is good for the market,” said Zito, who became an e-hailing driver and freelance graphic designer while he looked for a permanent job.

Fresh graduates, meanwhile, even those with degrees in so-called high-demand fields, such as engineering, are not faring any better.

Some told The Malaysian Insight that they are forced to accept low-paying jobs outside the scope of their studies.

This is a phenomenon captured by a Khazanah Research Institute study in 2018. KRI found that 95% of young workers in unskilled jobs and 50% of those in low-skilled manual jobs are overqualified for these occupations.

Manesh Kumar, 25, spent the whole of last year declining job offers because they were too low.

“After a year of not finding anything suitable I now don’t care how much I make as long as there is a job,” said the business administration graduate who currently works part time as a salesman in a shopping mall.

Ahmad Nazirul Mohamad was forced to accept a job in sales despite the fact that he holds an engineering degree.

“Many companies told me during the interview that they wanted people with experience. So I know that I will have to compete with people with experience,” said the Penang Universiti Teknologi Mara (UiTM) graduate.

“That’s why I didn’t really mind taking a job in sales.” – April 18, 2019.