Penang’s Skills Situation: Concerted Actions Needed

NOTE: The Authors wish to express that there were errors in the data for Table 3.1 and Table 3.2 and these have been amended as of 29 December 2021. We apologise for any inconvenience caused.

EXECUTIVE SUMMARY

• Penang’s market for job vacancies is currently dominated by manufacturing, engineering, information and communications technology (ICT), as well as sales, marketing and business development specialisations. This reflects a high and growing need for technical and digital skills, complex thinking, and interpersonal competencies.
• Fresh graduates have been disproportionately affected during the current downturn, compared to experienced workers. This has negative implications for lifetime employment outcomes, stemming from the combination of slowed job creation activity and falling proportions of entry-level vacancies.
• The fields of study Penang’s fresh graduates possess are inconsistent with what employers require. There is also a distinct lack of hard and soft skills among job applicants.
• While graduates from Kedah, Perak and Perlis help meet the labour demand from most of Penang’s key sectors, there remains a scarcity of ICT graduates across the entire northern region.
• Addressing these challenges require effort from all stakeholders:

a) Penang’s employers should tighten partnerships with education institutions, starting with those in the northern region, in terms of curriculum-planning and recruitment activities.

b) Initiatives to improve graduate quality need to be accompanied by incentives for them to remain in Penang upon graduating. Both public and industrial actors play important and complementing roles in developing liveability standards in Penang. Industrial actors should improve the attractiveness of work-related aspects, while public actors are recommended to improve labour market outcomes through regulation and the provision of information, and meet the demand for affordable public amenities.

c) The State’s skill and labour market initiatives should complement existing national programmes through close partnership with national human resources agencies.

d) Accurate and timely labour market information such as salary trends and skills demanded by employers need to be provided to educators, parents and students, to improve the career and education choices that students make.

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