DoSM: Malaysian graduates' salaries down in 2020 too, as they accepted any job amid Covid-19 crisis

The Covid-19 health crisis in Malaysia has weakened the overall demand for labour in the country. — Picture by Hari Anggara
The Covid-19 health crisis in Malaysia has weakened the overall demand for labour in the country. — Picture by Hari Anggara

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KUALA LUMPUR, July 14 — Malaysian graduates also suffered a decline in their average salaries in 2020, just like Malaysians with other educational qualifications, as they took on pretty much any job that was available amid a weak labour market during the Covid-19 crisis, the Department of Statistics Malaysia’s (DoSM) latest report showed.

In its Salaries & Wages Survey Report released today, DoSM today noted that Malaysian employees’ median and mean monthly salaries had declined for the first time across all educational attainment, especially for those whose qualifications are at the primary and secondary school levels.

DoSM explained that this was due to the Covid-19 health crisis in Malaysia that had been around for a year and which had weakened the overall demand for labour in the country.

“Thus, it had led to a higher competition in the labour market which became one of the reasons for jobseekers, especially graduates, to accept any jobs for living regardless of their qualification,” it said in explaining the scenario of more jobseekers competing for available jobs.

Amid such a situation, the median monthly salary for Malaysians with tertiary education (or whose higher level of education is above Form Five) went down from RM3,901 in 2019 to RM3,499, which marked a decrease by 10.3 per cent or a drop by RM402.

Median monthly salary for Malaysians whose highest level of education was secondary education went down from RM1,955 (2019) to RM1,630 (2020) or a decrease by RM325 (-16.6 per cent), while median monthly salary for those with primary education went down from RM1,560 (2019) to RM1,274 (2020) or a drop by RM286 (-18.3 per cent).

For Malaysians with no formal education, their median monthly salary as a whole dropped from RM1,436 (2019) to RM1,237 (2020), which represented a decline by RM199 (-13.9 per cent).

The median monthly salary in 2020 for those with primary education or no formal education was just slightly above the minimum wage level. (In Malaysia, the minimum wage is generally RM1,100, except for 56 locations (16 cities and 14 municipalities, including national capital Kuala Lumpur) where the minimum wage is RM1,200.)

Those with primary education are defined by DoSM as those whose highest level of education is from Year One to Six of primary school or equivalent, while those with secondary education are from Form One to Five, “O” Level certificate or equivalent and including basic skill training in specific trades and technical skills institutions of minimum six-month training period such as Giatmara.

 

 

 

The same was observed for mean monthly salaries, with the mean salary for the tertiary education category falling by RM472 or 10.2 per cent to RM4,171 in 2020, secondary education category falling by RM247 or 10.4 per cent to RM2,125 in 2020, primary education lowered by RM373 or 19.3 per cent to RM1,556, and the formal education category falling by RM161 or 10 per cent to RM1,447 in 2020.

The 2020 drop in mean and median monthly salaries across all education levels is a marked departure from the previous trend of steadily increasing salary levels.

As for the median monthly wages according to the highest certificate obtained by Malaysian employees, this was on a general upward trend since 2010, but has now recorded a marked decline in 2020 across the board.

On a rough eyeball, median monthly salary for all five categories of certificates in 2020 had been set back to levels of between three to five years ago.

In terms of amount, there was a reduction in median monthly income by RM212 for those with no certificate or had no formal education, -RM297 for those with SPM certificate and below, -RM336 for those with STPM or certificate, -RM308 for those with diploma and -RM630 for those with degrees.

While having the biggest drop in terms of amount, those with degrees have still consistently earned more than the other groups, with the data showing median salary levels going higher the higher ones’ certificate is. Degree holders’ median wages fell from RM5,496 in 2019 to RM4,866 in 2020.

Those with no certificates or no formal education saw their median wages falling from RM1,615 in 2019 to RM1,237 in 2020, which would be close to minimum wage levels in the country.

Those with no certificates refers to those who are currently attending school or who have completed schooling without receiving any certificate and also those with no formal education, while STPM or certificate category includes those who obtained certificates from college, polytechnic or other institutions offering formal education with certification of minimum six months, while diploma includes equivalent certificate obtained from a university, college or polytechnic above SPM and STPM or certificate level and before a degree qualification.

 

 

Earlier in the report, DoSM had observed that the Covid-19 crisis had resulted in containment measures throughout 2020 via different forms of the movement control order, which affected Malaysia’s economy and saw the unemployment rate increasing from 3.3 per cent in 2019 to 4.5 per cent in 2020. (In the Labour Force Statistics 2020 released by DoSM in April, Malaysia’s unemployed persons rose from 508,200 persons in 2019 to 711,000 persons in 2020.)

Apart from underemployment with limited operating hours for businesses, DoSM also observed that 2020 saw some businesses opting to cut wages or put employees on unpaid leave when operations could not be conducted as usual, but also said the government had rolled out various economic packages to cushion the economic impact.

The decline in median monthly wages for Malaysians of all education qualifications is consistent with last year’s overall decline in median and mean monthly wages for Malaysians, which is the first time since 2010.

Based on the DoSM report, the drop in median and mean monthly salaries in 2020 for Malaysians was recorded across the board, irrespective of gender, age (except for those between 40-44 years old), ethnicity, urban or rural locations, state, education levels or highest certificate obtained, skill level, and in almost all industries (except for four sectors).

 

 

Previously, Malay Mail had written about how data showed the proportion of Malaysia’s fresh graduates earning between RM1,001 and RM1,500 had reached its peak in 2020 when compared against recent years, and the explanation given by experts for this situation. 

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