About half of experienced Malaysian graduates surveyed are overqualified for their jobs

About one-third of 2010 graduates are still overqualified or earn below RM3,000 in their current jobs, whereas 40.0% and 58.0% of ~2018 graduates face persistent challenges in achieving qualification-job match or higher salaries.

As graduates dip their feet into the workforce and gain more experience in the labour market, observing their career progression and being aware of the types of challenges that they may encounter is important. 

According to a Khazanah Research Institute (KRI) report, about half of the experienced Malaysian graduates surveyed seem to be overqualified for their jobs. 

The report delved into the graduates’ employment experiences and their interaction with the labour market, to propose relevant policy recommendations.

Excerpts of the report, highlighting key takeaways regarding career progression in changing times, are shared below: 

Older cohort enjoys better outcomes while the younger plays catch-up

• The ~2010 cohort benefits from a time advantage with the accumulation of work experience compared to their ~2018 counterparts.
• About one-third of 2010 graduates are still overqualified or earn below RM3,000 in their current jobs, whereas 40.0% and 58.0% of ~2018 graduates face persistent challenges in achieving qualification-job match or higher salaries.
• The ~2018 cohort demonstrates faster transition time and career mobility, by attaining standard, match and high salary of employment. 
• Despite spending less time in the labour market, the younger cohort tends to opt for frequent job changes, signifying the potential gains from switching jobs to achieve fully transited status with greater job satisfaction.

Persistent issues of skills mismatch and wage stagnation among experienced graduates

• About half of experienced graduates in full-time permanent jobs are facing overqualification issues. 
• Overqualification is more prominent in various fields, particularly in the agriculture, veterinary, arts & humanities, and engineering.
• The number of full-time & contract/part-time graduates in the ~2018 batch who felt they were overqualified was 65.6% and 51.4% respectively. 
• This percentage falls closely behind the ~2010 batch, in which 67.6% of Full-time graduates, and 45.1% of Contract/Part-time graduates felt they were overqualified. 
• Wage stagnation also lingers around Malaysian skilled talents despite having several years of work experience and being employed full-time.
• The salary progression for graduates in non-standard employment has been slower compared to those in full-time employment.
• Less than half of self-employed ~2010 graduates earn more than RM3,000, compared to 28.9% of ~2018 graduates.

Compounding effect of first job quality points towards deeper structural problems

• According to the findings, one-third of experienced graduates retained qualification-job mismatch whereas a quarter have been earning low pay since their first jobs.
• At the same time, a low starting pay anchors down salary growth throughout graduates’ careers. Various fields of study and cohorts, except for education and social sciences, business & law graduates, enjoyed more pronounced salary progression over time.

Read the full report for details on five other key themes:

1. Career transitions of skilled talents: status and gaps
2. Fresh graduates, fresh challenge
3. Self-employment: a promising alternative?
4. Enhancing graduate employability
5. Job availability and matching efficiency

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READ MORE: Malaysia clocks in 5.92mn graduates in 2022, of which about 85% are in employment | Human Resources Online

Lead image / KRI