KUALA LUMPUR: Malaysia’s aspiration to become a high-income status nation by 2020 may be under threat as the number of jobless people keeps rising — with a high number of unemployed graduates — while its pool of high-skilled labour is still insufficient, according to independent economist Dr Muhammed Abdul Khalid.

Muhammed, formerly a director of the Khazanah Research Institute (KRI), said the number of jobless people rose between 4.5% and 18% year-on-year each month this year.

He said the number of jobless people in September grew 4.5% to 512,600, compared with 490,300 in the corresponding period last year. In January, the jobless figure was up 11.4% at 501,500, compared with 450,300 a year ago.

Muhammed told reporters this after presenting a talk on Malaysia’s job market outlook at the Millennial Development Programme launched by US-based General Electric International Inc and Malaysia's NexGen Impact. The joint initiative aims to equip young Malaysians with the right skills prior to entering the workforce.

The former KRI director shared that high-skilled labour in the country fell to 25.7% in 2015 from 27.6% in 2010, due to the arrival of migrant workers and the lack of high-skilled jobs.

“We create a lot of low- to mid-skilled jobs and not [enough] high-skilled jobs. In fact, the share of high-skilled jobs is declining; 80% of job creations since 2010 are low- to mid- skilled jobs,” he said.

“The rise in unemployment is challenging because the economy is not growing as fast as before. But this is not our fault because globally, the economy is not doing well.

“People are buying less products, and, being an open economy, Malaysian businesses do a lot of exports. So, firms are not going to export as much as before due to less demand. When demand drops, the demand for workers also reduces,” he said.

Muhammed also pointed out that one in three graduates are jobless, and that the number has risen to 34% in 2015 from 30% in 2013, with one in every 10 persons aged between 20 and 24 being unemployed.

“This is very serious. Why do people have no jobs? Our economy is still growing at a respectable level despite the global slowdown. Let’s not talk about high-income jobs, [because] to get a high-income job, you have to have a job first.

“I don’t want to sound pessimistic, but it is alarming and I have to be frank about it. We are achieving economic growth of 5% this year and 4.5% is expected next year. Although our unemployment rate is low, I am more concerned with the number of unemployed people,” he said.

Therefore, he said, firms should reduce working hours instead of laying off workers because there is no safety net for retrenched workers.

He also called for the introduction of unemployment insurance to help laid-off workers or those who have lost their jobs to survive for three to six months, and said nine out of 10 persons cannot survive beyond six months without an income, citing Bank Negara Malaysia.

Dubbed the “Employment Insurance Scheme”, the idea was mooted by the government in Budget 2015 to help retrenched workers, by tiding them over with some form of temporary financial aid and further skills training.

“They (the government) said they would look into this. We must seriously look into implementing it. There is no cost to the government because the premium would be paid by employers and employees.

“People think it is expensive, but it is not because the median salary in Malaysia is RM1,700. If you multiply it by three months, that amounts to RM5,100. How much premium would that be? It is not much, it is like motorcycle insurance,” he said.