By Sofea Azahar
As Budget day approaches, talks about the perks to be considered in addressing the setbacks of unprecedented crisis caused by the COVID-19 pandemic has been ongoing and youth is one of the targeted groups, among others, that need assistance.
Youth aged 15-24 who represent about 16% of the total Malaysian population is one of the vulnerable groups which has been impacted negatively by the crisis.
Since the national budget might not be a ‘one-size-fits-all’ budget, there are some significant issues of youth namely unemployment and underemployment, access to education and house ownership which can be considered for further actions.
- The need to address unemployment and underemployment
Concerns about youth employability have risen since the pandemic as plenty of them are either unemployed or underemployed.
This is backed by the verbal evidence gathered from EMIR Research focus group discussion (FGD) for our third quarter poll.
Youth unemployment rate registered at 10.5% in 2019, much higher than the overall unemployment rate of 3.3%. In absolute number, the unemployment rate represents 295,800 youths aged 15-24 who are unemployed.
Underemployment also becomes a concern as there seems to be a mismatch between graduate wages and qualifications despite their increasing employability.
Anecdotally, there are youths with degree or diploma qualifications who are left with no other choice but to go for the jobs with lower salaries and not in the industry of their expertise.
This situation has shaped a perception among the graduates that high qualification does not guarantee a good job when it is not supposed to be that way.
In the FGD, a discussant said: “After I finish my degree, I work at the non-government school alright. And I was paid only RM1,000 a month. So, when I asked my friend who work as a cleaner at KLIA, they are paid RM1,800 per month, and that’s really disturbing. We spent four years of our life for a degree and we getting a salary of only RM1,000. It makes me think that is would be better for me to work rather than furthering my degree.”
Job creation and trainings in line with the relevant industries especially post-pandemic are crucial to help mitigate both of these pressing issues for youth while upskilling or reskilling them to meet the demand from industries.
For instance, the hiring and training incentives provided by the government in Penjana package seems helpful for the firms and should be continued in a transparent manner.
These initiatives would be more sustainable in improving employability while generating the targeted 35% of high-skilled talents in the workforce.
It can also help strengthen youth’s social safety net rather than cash assistance that could be unsustainable in the long term as youth would possibly become dependent and it can also lead to abuse of aid.
- Improving the digital infrastructure for education sake
Equitable education access for youth must not be neglected in producing the best of human capital for the benefits of nation.
Since pandemic has forced us to leverage technology in many ways like getting access to education, not everyone is as privileged namely those in the B40 group and those living in rural areas where Internet connectivity or cost becomes the barrier.
Statistics from DOSM have shown that there is a gap between Internet access in urban and rural areas – 92.2% and 81.5% respectively.
It is indeed timely to pay closer attention to this issue as schools are currently closed due to rising COVID-19 infections which make students reliant on online learning.
Besides improving the quality and coverage of digital infrastructures, digital incentives should be given to those in B40 households and those living in rural areas for digital-related purchases such as tax reliefs for computers or tablets, and the government can allocation a portion of expenditure to provide digital equipment to the unprivileged students.
- Strengthening rental market for first-time youth house buyers
Finally, although it might not be as important or urgent as the two above, anecdotal evidence revealed that home ownership has become harder for youth particularly those in the B40 group due to employment uncertainty and insufficient incomes.
To make home ownership viable for youth, rent-to-own (RTO) schemes should be implemented across the nation for the affordable housing units in order to provide the options for the unprivileged.
In this scheme, youths who plan to own their own house but unable to afford purchasing can initially opt to rent at affordable rates for a few years.
Meanwhile, they can start saving in order to buy a house at the end of rental period or when they can secure mortgage loans. This would be in line with the proposal to create jobs for the youths to start securing incomes.
Sofea Azahar is Research Analyst at EMIR Research, a think tank focused on strategic policy recommendations based on rigorous research.