Why are there over 200,000 unemployed graduates? Will this crash the job market?

202,000 graduates are unemployed BUT we have 801,000 OUTSIDE labour force.

When I saw the stats, I smiled. The reason was because I suddenly remembered one conversation I had with a fellow colleague many years ago about one particular fresh graduate. She said that she has just encountered one amazing fresh graduate during an interview. I asked what was so amazing? This was the conversation, roughly.

My friend: You put here the base pay as RM4,000. You do know that this is a VERY high pay for a fresh graduate?

Graduate: Oh, I do not know. However, if I put anything lower than RM4,000 my father would laugh at my capability. You see, my monthly allowance is RM4,000 so I should not be working for a job which pays me lower, right?

I think that fresh graduate is not the only one in the market because as the title says, we have over 200,000 fresh graduates who is unemployed and at the same time, we have 800,000 fresh graduates who are just NOT looking for a job at the moment. Now, let’s look at the chart.

All charts in this article are from Department of Statistics Malaysia. (DOSM). Click here to view.

230,000 graduates every year

Refer to image below. We have a total of 5.36 million graduates in 2020 and 5.13 million graduates in 2019. This meant that in a year, a total of 230,000 graduates graduated. Think yeah, where do all these 230,000 graduates would move to to start their career or entrepreneurship journey.

Meanwhile out of this total, somehow we have over 801,000 who is out of the labour force by choice. This meant that they chose not to have a job at the moment. Many reasons were stated and if you like to read, do click the article to read yeah. Department of Statistics Malaysia. (DOSM). Click here to view.

Both genders show an increase in labour force participation. Image below. We could see that the participation on an overall basis increased 83.5% to 85%. Male participation is higher than female. I think this makes sense because many of my female friends are no longer working. Many reasons but I do not find that many male friends who are no longer working. Perhaps men just love to work? 😛

Unemployment has indeed increased on an overall basis. We can see that the percentage of graduates who were employed dropped from 96.1% in 2019 to just 95.6% in 2020. Image below. However, there are now more graduates finding work versus being outside the labour force. This is 2020 yeah, when times were harder. Perhaps this was also the reason why they entered the workforce? To help the household?

Graduates unemployed has increased by 37,000 persons when compared between 2019 and 2020. Image below. So, it’s NOT 200,000 increase just within 2020 yeah. In 2019, there were already 165,000 unemployed graduates. In 2020, this number increased by another 37,000. Well, 2021 has not been that awesome year at the moment, perhaps we will see a worsening number in 2021. Let’s keep ourselves updated yeah.

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