1

PRIME MINISTER'S OFFICE

@sl1moffical

Follow us on:

PN. HJH. NORASHIKIN BT. DATUK HAJI ISMAIL ECONOMIC PLANNING UNIT

PRIME MINISTER’S DEPARTMENT OF MALAYSIA

CONTENT OVERVIEW

01. Labor Market

Structure

31.7m Population

54.3% 45.7% Labour Force

Participation Rate

14.7m Labour Force

≈500k Avg. school leavers

each years

14.2m Employed

3.4% Unemployed

27% 60% 13% High skilled Semi skilled Low skilled

7.8 m 21.7 m

68% in Working Age Population (15-64)

1.9 m

65+ 0-14

14.7 m 7.0 m

68% in Labour Force 42% House

work

63% 39 yo & below 37%

62%

38%

Employment percentage by gender

LABOUR MARKET

Source: EPU analysis based DOSM population and LFS data

15m year 2020

target

62% Services

17% Manufacturing

11% Agriculture

9% Construction

1% Mining & Quarrying

Employment by Industry

Graduate from Higher Education

TVET from Higher Education

School

54% 36% 10%

54.2% Youth

unemployment

RM1,703 Median Wage

Employment percentage

by Nationality

84% 16% Malaysian

Non-Malaysian

5

02. Issues and

Way Forward

01 Youth High

Unemployment 10.5

17

3.4

7

0

5

10

15

2000 1990 1980

% 20

Total

Youth

Unemployment Rate 1982-2016

2010 2016

Triple than national

unemployment rate

[ ] Global Youth Unemployment (ILO 2016)

• World ~ 13.1%

• Developed Economies ~ 14.5%

• South East Asia & Pacific ~ 13.0%

Unemployment by Age Group (%)

16.5

37.7

22.7

9.4

13.7

0

10

20

30

40

15 - 19 20 - 24 25 - 29 30 - 34 35+

21% of unemployed

youth:

Diploma & Degree holders

Youth (age 15-24) constitute

more than half of unemployment

[54.2%]

@ 11% unemployment rate 7

2.6 3.5

Age Cohort of Youth Population (in millions)

Total: 6.1 mil.

Outside

labour force

Inside

labour market

67%

33%

73%

27%

20-24

15-19

20-24

15-19

MALE

FEMALE

02 TVET Workforce

Quantity Gap in

Lack of recognition for Technologist

Uncoordinated governance

Lack of industry input in

curriculum design

Unclear TVET articulation

Two accrediting bodies

Multiple Providers

No specialization in

public TVET

Fragmented TVET Delivery

Limited access to Higher Education

Wage premium in public

and private sector

Technologist not recognised

as professionals

Competency gaps among Instructors

No centralised database

on instructor profile

Minimal industry exposure

Skills deficiencies

TVET ISSUES

AND

CHALLENGES

No rating system for

performance

8

0.7 Mn TVET workforce supplied (2014 to 2020)

1.0 Mn TVET workforce demanded (2014 to 2020)

Net undersupply

0.3Mn

03 Foreign Participation of

Workers 2,270

0

500

1,000

1,500

2,000

2,500

2010 2000 1990 1980

(‘000 person) +9% +181%

1,818

2,063

807

410

242

Manufacturing Services Agriculture Construction

19% 21% 25% 35%

Sector Participated by Foreign Workers

181% increase of foreign workers employment since

2000-2013 (legal)

Lack of comprehensive policy on addressing the issues in

holistic manner

Issues regarding enforcement – estimated higher number

of illegal foreign workers

Improve management of FW employment

• Centralised administration

Middle skills foreign workers (<RM5,000)

• Clear policy direction

Improve levy mechanism

• Additional levy increase to be used for

up-skilling and automation

Policy

• Develop a comprehensive policy and strategies

• Long term strategy for industry to move from

labour to capital incentive

Evaluate policy based on industry performance/growth

9

04 Woman

In The Labour Force Participation

VIE

TNA

M

THA

ILA

ND

SIN

GA

PO

RE

MA

LAYS

IA

PH

ILIP

PIN

ES

IND

ON

ES

IA

73

.3%

61

.7%

58

.6%

*

53

.6%

50

.5%

50

.2%

**

100

75

50

25

0

2012

49.5%

2013

52.4%

2014

53.6% 2.9% 1.2%

Source : World Bank (databank.worldbank.org)

*Source : Ministry of Manpower, Singapore

** Source : International Labour Organization

DOUBLE

PEAKED

10

20

30

40

50

60

70

80

0

20 25 30 35 40 45 50 55 60 65

• Issues on professionalism &

roles of woman in decision

making

• High enrolment in universities

but less in the Labour Market

• Lack of mobility

• Involvement in informal sector

• Work-life balance

• Low LFPR for women with high

education attainment

• Low Female LFPR in Malaysia

compared to neighbouring

countries.

Incentives for return to work

Flexible working hours

Career comeback

Upskilling and reskilling

Increase childcare centre (affordability, quality)

Additional initiatives to increase woman participation rate by 59% in

2020 and 67% in 2050.

Promote work life balance for working mothers

Increase female participation in top management and decision

making level.

10

Way Forward

03. Government

Initiatives

Government Initiatives on

Human Capital Building

Others

Retrenchment

Employment Insurance Scheme

Underprivileged

Drop-Out

B40

Community

Handicap

Skim Penggajian Orang Kurang Upaya

(SP-OKU)

Geran Skim Bantuan Galakan Perniagaan Orang

Kurang Upaya (SBGP-OKU)

Talent bridging

& outreach

Graduates

Structured

Internship Industry –

Academia

Collaboration

Financial Sector

Entrepreneurship

Facilitating SMEs

Digital

(Crowdsourcing)

Young Entrepreneur

SMEs Training

Centre Micro Credit

High

Potential

Latent Workforce

• Single Mother

• Retirees

• Prisoners /

Ex-prisoners

• Former Drug

Addict

• Indigenous People

• Homeless

Expatriate

Retention

Ease of

Application

Foreign Worker

Malaysian

12

TVET

Upskilling

National

Plan

Provider

Women

Childcare

facilities

Career

Comeback

Flexible Work

Arrangement

Side Income

for Housewife

Highlights of the

ELEVENTH MALAYSIA PLAN 2016-2020

13

The Eleventh Plan focuses on multi-dimensional goals …

Multidimensional goals to ensure sustainable and inclusive growth

• GDP growth at 5-6% per annum

• Labour productivity increases from RM77,100 (2015)

to RM92,300 (2020)

• GNI per capita at RM54,100 by 2020

• Average monthly household income increases from RM6,141 (2014) to

RM10,540 (2020)

• Compensation of employees to GDP increase from 34.9% (2015) to

(2020) 40%

• Malaysia Wellbeing Index to increase by 1.7% p.a.

14

RM2,540

0

5,000

10,000

15,000

20,000

25,000

1989 2009 2014 2020

Average monthly household income (current price)

Income Group

% p.a.

2011-2015

2016-2020

National 8.9 9.8

T20 7.2 8.2

M40 9.5 10.1

B40 12.7 13.2

B40 : RM5,270

M40 : RM9,970

National Average:

RM10,540

National Median: RM8,420

T20 : RM22,240

6.90 6.94 5.64 4.22

Ratio of T20 over B40 income

Target for more rapid increase in income for B40 households and narrower gap between income groups

Economic Planning Unit©, Prime Minister’s Department, Malaysia

Transforming TVET to meet industry demand

Strengthening lifelong learning for skills enhancement

Improving the quality of education for better student outcomes and institutional

excellence

Improving labour market efficiency to accelerate economic growth

Strategic Thrust 3 Accelerating human capital development for an advanced nation

3.7%

40%

Labour productivity growth rate per annum

Compensation of employees to GDP in 2020

Monthly median wage in 2020

2,500 RM

100 TOP

2 universities in Top 100 of the QS World University Rankings

Student enrolment from preschool to upper secondary

100%

Intake of SPM leavers to TVET programmes

225,0000

Increase in number of employees that will benefit from expansion of the HRDF act

58%

Game Changer Enabling industry-led Technical and Vocational Education and Training (TVET) 60% of the 1.5 million jobs that will be created during the Eleventh Plan will require TVET-related skills

Main strategies and selected outcomes

225,000

15 Economic Planning Unit©, Prime Minister’s Department, Malaysia

04. Government Initiative:

Skim Latihan 1Malaysia

One of the Malaysian government initiatives in addressing

the issue of unemployed graduates

Collaboration among GLCs and private companies using

the concept of Corporate Social Responsibility (CSR)

Established since June 1st, 2011, under the supervision

of Economic Planning Unit, Prime Minister‘s Department

17

Objective Improving self-confidence, personal

development and boosting the

marketability of graduates mainly

from poor families or rural areas in

securing a job

Target groups

unemployed citizens who are

from low income families or live

in remote areas

working but not equivalent with

the qualifications obtained

Degree holders and above

Minimum RM1,500 monthly allowances will be paid directly to each SL1M participants by the company throughout the training

Max. 2 months

Communication

Skills

Creative and

Analytical Thinking

Organizational

Adaptability

Value-Driven

Professional Grooming and

Etiquette

Classroom Training On-The-Job Training

Max. 12 months

Participants will be trained to work as a permanent employees of the company and given a mentor to guide them

As a result, participants will be exposed to real work experience in organizations both large and also small and medium size industries

5 required modules:

(tailored to business need of the participating company)

*Durations are depending on the needs of each company

18

SL1

M T

RA

ININ

G S

TRC

UTU

RE

INCENTIVES TO COMPANIES

Double Tax Deduction (June 2012 - December 2020)

Double tax deduction on expenses incurred by the

company to train (training cost + monthly

allowances) unemployed graduates to enhance

their marketability under the scheme

HRDF-SL1M SCHEME (Starting Apr 2014)

Contributions under the HRDF levy will be used to

reduce the expenses of the company towards

training the SL1M participants

Each expenditures incurred to train every SL1M participants,

companies are eligible to claim either one of these incentives:

19

Career Accelerator

Re-skilling 2nd Chance Programme

Skill specialization / up-skilling

Job Market

Other government

initiatives

Par

tici

pat

ing

GLC

s an

d p

riva

te

com

pan

ies

Employability Interventions

Unemployed

graduates

20

Different approach by each company to cater different group of unemployed graduates

CSR

B7 beneficiaries from government

contract

KPI for the GLCs

21

Open Interview Catalyst Booster Management

Training

Outreach (indirect assist)

Training (direct assist)

• Classroom training with minimum 5 modules • On the job training

Requirement

Open to all Degree graduates

Duration 6 – 12 months

• Rigorous classroom training with minimum 5 modules

• Send to a career fair

Requirement Degree graduates who require

minimum intervention

Duration 3 days – 2 months

• Open to all education level • Outreach programmes

throughout the country by zoning

Requirement

Open to all job seekers

Duration 2-5 days / OI

• Career/Motivation Talk

Requirement University students in final

semester

• Video SL1M

22

Finance and Investment 16%

Information and Communication 4%

Oil and gas 6%

Construction and Housing 9%

Manufacturing 6%

Transportation and Logistics 11%

Services 40%

Agriculture and Farming 5%

Utilities 3%

COMPANIES PARTICIPATED IN THE PROGRAMME BY SECTOR

23

Year KPIs Number of Graduates Assisted

Directly Indirectly

2011 4,000 4,197 -

2012 4,000 4,622 14,072

2013 4,000 4,450 13,322

2014 4,000 4,185 6,741

2015 10,000 10,000 9,500

2016 15,000 15,000 18,915

2017 20,000 6,000 11,354

(up to Apr 17) 48,454 73,904

Total 122,358

4,000 4,000 4,000 4,000

10,000

15,000

20,000

4,197 4,622 4,450 4,185

10,000

15,000

6,000

0

14,072 13,322

6,741

9,500

18,915

11,354

-

5,000

10,000

15,000

20,000

25,000

2011 2012 2013 2014 2015 2016 2017

Number of Graduates Assisted from 2011 to Apr 2017

KPIS Directly Assisted Indirectly Assisted Expon. (Directly Assisted)

24

05. Malaysia

Beyond 2020

Economy … an advanced, progressive and an inclusive economy that leaves an

imprint on the world. Our national development will move beyond a focus on

economic growth and consumerism, towards becoming a socially advanced

economy with emphasis on the rakyat’s wellbeing.

... world class high income nation and diversified high value added

economic activity

... Sustainable development and improve qualities of life.

Environment … a passionate steward of the environment. We will value, protect,

preserve, and take pride in our unique flora and fauna.

… Conducive and harmony working environment.

Malaysia will be…

26

People … united in diversity, possess unshakeable national identity and share a

common set of values.

… a great nation as reflected in how we care for the underprivileged, the

vulnerable, the disabled, and those with special needs.

… led by a government that delivers, led by leaders with integrity and

conviction who embrace the concept of amanah

… Highly skilled and productive workforce.

… Positive attitude and competitive workforce at national and international

level.

… Trainable, talented and innovative workers.

… Responsive, creative and caring employers.

27

Thank you

@sl1moffical

Follow us on:

28