Malaysian Employers Federation's (MEF) executive director Shamsuddin Bardan pointed out that employers are reluctant to hire fresh graduates due to their "unrealistic" expectations and unwillingness to learn new skills.

Responding to Bank Negara Malaysia's report which placed the youth unemployment rate at 10.7% (3.5 times that of the national unemployment rate), Shamsuddin told FMT: "The future of the economy is unsure and most companies are not taking in new staff, so there are fewer entry level positions available."

Shamsuddin further noted that some companies would rather invest in technology than hire new workers, who would cost money to train.

Giving an example, he said: "Two years ago, the banking industry laid off 18,000 workers in various positions because it had shifted towards greater use of technology."

The MEF executive director added that bosses preferred workers who were 'ready to work' as it could take up to a year to train a fresh graduate.

The general perception that fresh graduates are "choosy and unrealistic" doesn't help their case. Shamsuddin revealed that this perception adds to employers' reluctance to hire this group of workers.

"Many fresh graduates aren’t keen on jobs that aren’t in the fields they studied in. This is unrealistic and it shows that they aren’t willing to adapt and learn new things. We are in an age where workers are expected to multi-task. Fresh graduates need to be open to learning and doing different things."

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Only laid off workers can get financial aid from EIS

In a separate interview with Bernama, Shamsuddin emphasised that the newly introduced Employment Insurance System (EIS) is only applicable to workers who were laid off involuntarily, adding that the system would not be applicable to those who stopped work voluntarily.

"EIS will only pay assistance to workers who are laid off involuntarily for six months with an average payment of half-month salary," he told Bernama.

According to Bernama, Shamsuddin said MEF had proposed that a third account be created in a worker’s Employees Provident Fund (EPF) as a saving scheme for workers who were retrenched.

“For example, employer and worker each contributes one per cent of the pay each month for eight years whereby the amount in the account would touch a month’s pay.

“If the workers’ services are terminated involuntarily, they can take out the savings in question. If they do not get terminated, the savings can be used for their retirement,” he explained.

In order to make the benefit obtained equivalent to three-month pay as suggested under EIS, Shamsuddin recommended that the government must set aside a special fund for this purpose.

READ MORE: 37,699 workers were terminated in Malaysia in 2016

At the same time, Malaysian Trades Union Congress (MTUC) president Abdul Halim Mansor told Bernama that the implementation of EIS would reduce employers’ burden when a retrenchment crisis took place.

“A company may face cash constraints when retrenchment or closure of the operation takes place, so an alternative legal provision is necessary to meet the demands of the workers,” he said.

Halim added that through EIS workers who had lost their jobs would also be sent for retraining or skills upgrading courses to increase their employability.

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