Analysis: Unemployed youth in Malaysia

SELANGOR Traveler numbers are rising, investments are expanding, and Malaysia’s economy is steadily improving. The economy is expanding, domestic demand is rising, and the jobless rate has dropped back to what it was before the outbreak. Things appear to be going well on the surface. However, the positive statistics emerging from Malaysia conceal an impending crisis: youth unemployment. The Department of Statistics Malaysia published its labor report just before the Chinese New Year, indicating that employment increased in every industry and the unemployment rate remained stable at 3.3% in the last month of 2023.

 

However, the statistics about youth unemployment presented a different picture. 307,200 young Malaysians between the ages of 15 and 24 were unemployed as of December of last year, which translates to a 10.6% unemployment rate. In the meantime, 432,100 youths in the broader 15 to 30 age group had an unemployment rate of 6.4%. To put this in perspective, these young people make up almost 76% of Malaysia’s 567,800 unemployed individuals. To make matters worse, an additional 5 to 6 million pupils are scheduled to graduate this year. It got much harder for young individuals looking to enter the workforce in 2023 as job development slowed down at the same period.

 

One should not undervalue the social, economic, and political ramifications of youth unemployment. This is not just a cyclical problem; in order to bring about long-lasting change, structural reform is necessary because the defects and difficulties are ingrained in the system itself. Youth unemployment that doesn’t go away could be bad for Malaysia’s labor force and economic expansion. This could put further pressure on the already precarious budgetary situation by increasing government spending on social programs in addition to Malaysia’s history of providing incentives and financial aid. In addition, young Malaysians may inherit a financial catastrophe from older generations with insufficient retirement savings (almost half have less than RM10,000 (US$2,110) in their Employees Provident Fund accounts). Low income further complicates matters.

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