Much of the data simply compiles stuff from 2018 and much of the data are known to us already such as inflation numbers and GDP contribution. Moreover, pretty much of these data are only suitable if you are an analyst looking for a new alley of investment.
What You Would Like to Know
We found that one section that would always interest the general public where it talks about wages in the country. For starters, how are we paid in comparison to people in the world?
It is pretty depressing that on average we are paid only USD340 for an output worth USD1000. This debunked the case more often brought up that Malaysian are under-performers at work because every person receives less for the same output. The only factor we can relate to is technology.
Assuming a product ‘Made in America’ sells at USD100 but the actual maker of the physical product is an Original Equipment Manufacturere (OEM) in Malaysia (most cases). The American company pays probably only 30% of the selling price to the real producers of the product.
On the other hand, the American company pockets USD70 as they initially invested in research for the particular product. Literally the American did less work but profit a larger sum of money due to the technology that they developed. The ingenuity of making smarter investment decision gains them an edge in technology through research in this case.
Another factor that caught our eye would be the ratio of wages to productivity across sectors. Similarly in every segment, we are behind the numbers recorded by benchmark economies.
Mining by far is still the highest in terms of median wages while agriculture, retail and construction records the lowest. Retail and construction sees the biggest gain annually but that was due to having a low base to start with.
The other factor that caught our eye would be the real starting salaries for graduates. Indeed the number of labor force with tertiary level education had increased 5% in the last 7 years.
Problem is executives with any tertiary education has seen a decline in real wages. A common case of supply being more than demand with government extending the retirement age for everyone.
The graduates blame the employers while employers blame the graduates. This is where education starts to backfire where a certificate had became only a ticket to enter the workforce rather than a specialization obtained through study.
The employers however chose to use the simplest method of measurement which is level of education but in contrast graduates are filled to the brink with unrealistic expectations through education. Many over-estimated their ability due to the demand from school versus from work.
It is a never ending mess left by the education system and it is happening everywhere round the world. Looks at though it will get worse with time.
Apart from wages report, the economic report by BNM showed that the Malaysian economy is having a good time in 2018. The coffers of our government are still full where we could sustain even RM 1 trillion of debt.
Malaysia isn’t going to bankrupt like what is in everyone’s mind (political stunt). But the reason people felt that Malaysia is doing a very bad job is most likely linked to how they felt by their personal well-being translated through lower wage growth.
Day after day graduates come out with no jobs has their parents thinking back that it wasn’t that hard 30 years ago. Well times had changed but the education system did not. People are trained on obsolete skills rather than 21st century knowledge like coding.
If you are interested in the full report download it here
**With so many reach for this post, we would like to apologize for language errors on the article, no proof reading was done..