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With the minimum wage stuck at RM1,500, most M’sian fresh grads prefer to work in the gig economy or apply to jobs in Singapore and overseas.
Living with aging parents, Mindy was earning RM 1800 as an admin assistant in Klang Valley. After subtracting living expenses, she was only saving up RM100-200 each month.
Mindy decided to secure a higher paying job in Singapore so that she can better take care of them in their old age.
She found work as a cashier in a Bengawan Solo bakery in Changi Airport. The hourly rate is SGD 12 per, which is RM42 after conversion. After subtracting living expenses, she says she can save up to SGD 500, or around RM 1760 a month.
“Moving to Singapore is the right choice so I can secure a better future,” says Mindy.
The number of underemployed M’sian fresh grads have doubled since 2021.
In 2021, there were around 40,000 unemployed fresh graduates in Malaysia. Now in 2024, that figure is estimated to be closer to 90,000.
It’s no secret that the starting salary for fresh grads is lagging behind inflation, with scarce local opportunities for first-time job seekers.
According to data by the Dept of Statistics, wages have only increased modestly over the years with an average increase of RM167 per year from 2012 to 2019.
Meanwhile, the cost of living has outpaced our wages. Due to higher fuel inflation, the inflation rate rose to 2.5% in 2021 and increased to 3.3% in 2022.
With poor starting salaries, many Malaysians are stuck in the gig-economy.
After graduating, Edam started driving for Grabcar while searching for a full-time role, but soon found that he could also work for Foodpanda, Gogetter, and Lalamove.
“Grab pays about RM1500 a month for 120 hours of work. Foodpanda pays me about RM 300 a month. With Lalamove, I can make about RM1000 for about 40 hours a month. Go getters nets me about the same as Lalamove.”
All told, Edam gets by on RM3800 a month. He shares that this is the reason he has been unable to find full-time work; none of the offers match what he earns doing part-time gig jobs.
One economist has called for a raise of the minimum wage to RM1,600.
“The RM1,500 per month level is too low and below most reasonable poverty indicators,” said Malaysian University of Science and Technology’s economic professor, Geoffrey Williams.
“Unless companies rethink their pay rates they will continue to struggle to find employees, and people will leave for the gig-economy where even the most basic jobs earn more than RM1,500.”
Geoffrey Williams added, “Most businesses are already paying above the minimum wage. Those that pay less do not have a viable business model and should change their approach or shut down.”
Unless the economy is transformed, Malaysia will lose all of its young talent to other countries like Singapore.
If Malaysia is to transition into a developed nation, we should expect that the economy should grow to provide higher-skilled jobs for a more educated workforce.
If nothing is being done to address all these core issues, we may soon find ourselves becoming a nation known for exporting skilled workers, at the cost of their own development, such as the Philippines.
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Read also:
I Left Malaysia for Greener Pastures and Was Advised to Never Come Back. Here’s Why I Did.
I Left Malaysia for Greener Pastures and Was Advised to Never Come Back. Here’s Why I Did.
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