# data[].attributes.body
1. Lee Hai Jie
2. Ngan Chung Pui
3. Wong Kwan Siang
4. Joshua Ng
5. Loh Wei Hung
Class: TA22

# data[].attributes.body
Malaysia's Q3  2018 GDP Growth slowed 4.4% from the previous quarter.

This can be attributed to the decrease in government expenditure and lower export values as a result of the ongoing trade skirmish between China and the USA.

Inflation in September peaked at 0.3% and increased 0.2% YoY. This occurred when it scrapped Goods and Service Tax (GST) in June. Inflation rate has decreased overall for 2018 and Malaysia thus experienced disinflation for year to date 2018.

Unemployment rate was constant for 3 months ending 30 September 2018 between 3.3% - 3.4%. YoY, unemployment rate rose 1.6%. The labor force participation rate in September increased slightly by 0.1% from August to 68.5%. However, YoY the labor force participation rate increased 0.6%.
This is due to a slowdown in hiring among business as Malaysia's economic outlook appears to be mixed.

In this report, we will look deeper into the causes of the current trends of gdp, unemployment and inflation in Q3 of 2018 as well as referencing trend history throughout 2018.

# data[].attributes.body
Thank you for choosing our neighbor to do your analysis.
Malaysia is going through some problems and challenges with the change of the government.

Do more research to find out the causes of the trends and future challenges.

You may start writing the report once you are ready with more facts.

Cheers!

josh Nathan

# data[].attributes.attachment_link.title
Department of Statistics Malaysia Official Portal

# data[].attributes.attachment_link.description
Department of Statistics Malaysia Official Portal

# data[].attributes.attachment_link.readable_text
MALAYSIA'S growth story is coming under pressure from many sides, including a shortage of skilled workers in critical occupations, high dependency on cheap labour, which discourages investment in innovation, a higher education system hungry for resources and low collaboration between industry and academia. Can the stakeholders come together to solve this complex problem? Rash Behari Bhattacharjee and Syahirah Syed Jaafar examine the issue.

The list of human capital obstacles that the nation is facing is certainly formidable. Take the skills mismatch that hangs over graduate job seekers like an unwelcome cloud.

The shortage of skilled workers is not only seen in the persistent problem of youth unemployment but it is also cited by businesses as a key factor constraining investment. This raises a host of questions.

Can Malaysia's higher education system close the gap between jobs and candidates' skills that is making vacancies in critical occupations increasingly hard to fill?

The answer to that question is keenly awaited by the stakeholders - including students, higher learning institutions and businesses - whose fortunes depend on the outcome.

Employers in 10 key economic sectors surveyed by the government's Critical Skills Monitoring Committee report four main effects of staff shortage.

The committee's Critical Occupations List (COL) Report 2016/17, a bellwether study by Talent Corp Malaysia Bhd and the Institute of Labour Market Information and Analysis, identifies these effects as increased workload on current employees, difficulties in providing quality goods and services, increased costs and difficulties in meeting customer needs (see Table 1).

Malaysian Employers Federation executive director Datuk Shamsuddin Bardan gives an example of where the problem lies.

"With the current trend towards digitalisation, companies need data analysts to mine big data for business growth," he tells The Edge.

"Unfortunately, a lot of IT graduates are not suitable for this work because they have not been trained for it.

"As a result, companies turn to countries like India because we don't have the people. I think that is very telling. The industry has moved ahead but the system is not able to fit the industry with the right people."

The COL report verifies this. It states that big data analytics was one of the top skills in demand in Malaysia in 2016, citing studies by recruitment consultancy Hays and career networking platform LinkedIn, in addition to the COL survey findings.

Worse, the crunch is not about to be resolved soon. Employers in the COL survey frequently responded that they found it harder to fill these vacancies compared with the previous year, or they expected the trend to continue.

Interestingly, the latest Hays forecast on Jobs and Skills Trends for 2018 sees "an explosion in new roles around artificial intelligence and data and a relentless demand for specific soft skills such as adaptability, creativity and collaboration".

One constraint is that employers today want market-ready candidates to fill their vacancies rather than investing in training recruits, says Shamsuddin.

"Companies are not patient enough to train our people anymore. They say it is not their role. In the early 1980s or late 1970s, employers were prepared to train people, even up to one year. But now, they would rather have people who can contribute straight away to the organisation," he says (see Table 2 on Page 56).

Recognising the huge challenges in skills development, the Ministry of Higher Education (MOHE) is engaged in a national transformation initiative to deal with this issue in all its complexity.

"MOHE is mindful that higher education as well as market demands are constantly evolving, with new skills, knowledge and expertise required," Higher Education Minister Datuk Seri Idris Jusoh says in an email reply to The Edge.

"This means that MOHE too needs to evolve to ensure that educational offerings of Malaysian higher education institutions (HEIs) are in line with the needs of industry, while also keeping in mind the role of education to promote good values and appreciation for the arts, history and social sciences."
High expectations, insufficient skills
As for why businesses found it difficult to recruit the right people, the top four factors were:

* High expectations of salaries/benefits;

* Insufficient work experience;

* Insufficient technical skills; and

* Insufficient soft skills such as creativity and communication. (See Table 3 on Page 56.)

Many questions arise from this conundrum: Why is there an unbridgeable gap between the remuneration offered and job seekers' expectations? What lies behind the multiple skills deficits - student quality, deficient training, policy issues, or all of the above? Are industry and academia working together enough on solutions?
Dependence on cheap labour
The Bank Negara Malaysia 2016 Annual Report shines the spotlight on the dilemma.

In an article on youth unemployment, the report summarises the multiple dimensions of the problem.

"Despite the workforce increasingly becoming more educated, job creation in the Malaysian economy has remained concentrated in the low and mid-skilled jobs, as domestic industries stay in low value-added activities that emphasise cost efficiency and dependence on cheap labour, rather than pursuing innovation as a source of growth," it states.

"The Malaysian economy also continues to face the challenge of attracting high-quality investments that would create more high-paying, high-skilled jobs for the local workforce. In the meantime, firms point to skills shortage as a key factor that prevents them from making investments to move up the value chain.

"This mismatch between the changes in educational attainment of the workforce and the types of jobs created is also manifested to some extent in anaemic demand for fresh graduates, as online job postings for entry-level positions for graduates have remained largely stagnant since 2012."

The article cites a 2014 survey by the World Bank and TalentCorp, which found that 90% of companies believe that university graduates should have more industrial training, and 81% of companies rated communication skills as a major deficit among graduates.

While businesses point to weaknesses in the national education and technical and vocational education and training (TVET) systems for the poor job prospects of graduates, the article notes, the lack of industry involvement in human capital development has also contributed to the dearth of effective training programmes for workers.

"The same TalentCorp survey found that 53% of firms have never engaged career centres in their recruitment efforts. Thus, even though youth may lack requisite skills, effective, meaningful training programmes that would prepare them for work have also not been forthcoming," the Bank Negara report states.
Malaysia Education Blueprint (Higher Education)
Cognisant of the situation, the MOHE has been developing a national plan of action to bring the higher education system up to speed.

A key step forward is the Malaysia Education Blueprint 2015-2025 (Higher Education), which outlines 10 shifts that are designed to transform the higher education system.

Four of them focus on outcomes for key stakeholders, namely students in academic and TVET pathways, the academic community and people engaging in lifelong learning. The other six concern enablers such as funding, governance, innovation, international links, online learning and delivery.

By the ministry's reckoning, important progress is being made towards addressing the skills mismatch.

"Between 2007 and 2015, MOHE was guided by the National Higher Education Strategic Plan, in which Improving Graduate Employability (GE) was a part," says Idris. "The GE rate in Malaysia increased 2.9% from 74.4% in 2012 to 77.3% in 2016."

However, business leaders, such as property developer Datuk David Chua Kok Tee, who has served on several national committees and academic boards, say the problem remains entrenched.

"It is difficult to recruit good quality graduates as many either don't speak good English or don't have the right skills for the job. They are hired anyway and then retrained," Chua tells The Edge.

Former deputy education minister Datuk Saifuddin Abdullah identifies distinct factors behind the two types of skills gaps.

Concerning the lack of soft skills, he argues that despite some effort to address the gap, there is no comprehensive and integrated approach to the problem.

As for the skills shortfall in professional fields like law, engineering, architecture and accounting, Saifuddin, in an email response, notes that these disciplines require several years of understudy with a supervisor and certification by an accreditation body.

"For law, it is not an issue. But for engineering, architecture and accounting, the number of lecturers who are chartered professionals is actually very low. So, what do you expect from the graduates?" asks Saifuddin, who is chief secretary of the Pakatan Harapan coalition.

Former Univerisiti Malaya vice-chancellor Tan Sri Ghauth Jasmon opines that the time to administer strong medicine is past due.

Noting that both public and private HEIs are facing a financial crunch, Ghauth, who is on the boards of Sunway University and the International University of Malaya-Wales, stresses that universities must address this predicament or perish.

"It will be difficult for universities to survive if they do not find ways to sustain financially, especially as the government cuts the budget for higher education," he tells The Edge.

TalentCorp CEO Shareen Shariza Abdul Ghani sees the need for a systemic overhaul.

"Our traditional teaching methods and educational syllabus must be realigned so that we can accelerate education reform towards building 21st century skills," she tells The Edge in an email.

"Educators and syllabus designers must recognise that today's skills, with their short and decreasing shelf lives, are quickly becoming obsolete."

Reformists often say the education system is the root of the problem.

For the DAP's parliamentary spokesperson for education, science and technology, Zairil Khir Johari, the required shift in strategy will make our education system very different from its current form.

The key is to depoliticise education and let academic boards independently set standards and handle administration in response to community needs, he tells The Edge.

Penang Institute in Kuala Lumpur general manager Dr Ong Kian Ming, a vocal advocate for academic quality, says the issue boils down to the question of employability.

"The first part of the challenge is what needs to change in order that educational institutions produce graduates who meet a minimum bar of being employable - being able to communicate clearly, show a basic understanding of concepts and how to apply them to the real world, an ability to absorb and process information in the workplace, and an ability to write and produce output that is understandable," says Ong, who is MP for Serdang.

To add to the pressures facing businesses, global developments, including the impact of the Fourth Industrial Revolution, are rapidly changing the rules of the game.

One expert who is helping the Ministry of Higher Education to prepare for this shift is Australia-based Prof Sohail Inayatullah, the Unesco Chair in Futures Studies.

Tracing various scenarios that emerge in an evolving learning environment, he presents a compelling case for fostering innovation in the education system.

"Teaching training should be adapted to prepare for a world after jobs," he tells The Edge.

In this scenario, lifelong learning is not a fancy idea but a critical requirement for adapting to the new economic reality.

For example, in Finland, a world leader in education, some 2.5 million of its 5.5 million people are engaged in lifelong education programmes at any given time.

Finland's former education minister and current director-general of the Finnish National Agency for Education, Olli-Pekka Heinonen, says, "We don't know much about the future. We know the people who best cope with uncertainty are creative people. They are versatile in different circumstances."

In a report entitled An Uneven Future? An Exploration of the Future of Work in Malaysia, Khazanah Research Institute director of research Allen Ng notes that as the landscape of employment changes over the coming decades, inculcating lifelong learning for all is essential to ponder, given two important trends.

"Firstly, the fast pace of progress in technology would most likely lead to more rapid cycles of obsolescence and renewal in the types of work and industries available. Secondly, together with the first trend, with the rise of independent work, the traditional employer-employee relationship could be eroded, which would simultaneously provide greater autonomy to workers but remove the stability of more traditional full-time fixed employment," he says.

All said, the range of challenges adds up to quite a formidable test of our resilience as an economy. Can academia and industry forge a dynamic partnership to respond to this critical task?

# data[].attributes.attachment_link.title
Special Report: Missing skills: Is higher education on the mark?

# data[].attributes.attachment_link.description
MALAYSIA'S growth story is coming under pressure from many sides, including a shortage of skilled workers in critical occupations, high dependency on cheap labour, which discourages investment in innovation, a higher education system hungry for resources and low collaboration between industry and academia. Can the stakeholders come together to solve this complex problem?

# data[].attributes.body
Malaysia Unemployment

# data[].attributes.attachment_link.description
Find out the truth behind why fresh graduates are unemployed in Malaysia and learn what you can do to increase your employability!

# data[].attributes.attachment_link.readable_text
[KUALA LUMPUR] Malaysia's consumer price index rose at its slowest pace in more than three years in June, following the withdrawal of a goods and services tax (GST), government data showed on Wednesday.

The inflation rate in June was at 0.8 per cent, its lowest since February 2015, when it was at 0.1 per cent.

The figure was below the 1.3 per cent forecast by a Reuters poll and sharply down from the 1.8 per cent recorded in May.

The abolishment of GST as well as discounts and price control measures during the Eid al-Fitr celebrations had a significant impact on prices of goods in June, the Statistics Department said in a statement.

The new government led by Prime Minister Mahathir Mohamad, put in office after the May 9 general election, scrapped the 6 per cent consumption tax on June 1.

In June, costs were down across all goods and services except for the transport index, which rose 5.5 per cent from a year earlier due to higher domestic fuel prices, data from the department showed.

Malaysia's central bank left its key interest rate unchanged at 3.25 per cent in its last review, citing slowing inflation and steady economic growth.

REUTERS

# data[].attributes.attachment_link.title
Malaysia's June inflation rate at 3-year low after GST withdrawal

# data[].attributes.attachment_link.description
THE BUSINESS TIMES Government & Economy - [KUALA LUMPUR] Malaysia's consumer price index rose at its slowest pace in more than three years in June, following the withdrawal of a goods and services tax (GST), government data showed on Wednesday.. Read more at The Business Times.

# data[].attributes.attachment_link.title
Malaysia Inflation Rate | 2019 | Data | Chart | Calendar | Forecast | News

# data[].attributes.attachment_link.description
Malaysia's consumer prices decreased 0.4 percent year-on-year in February 2019, following a 0.7 percent fall in the previous month and more than an expected 0.3 percent drop. This was the second annual straight decline in consumer prices since November 2009, mainly due to transport prices while inflation was steady for both food and housing.

# data[].attributes.attachment_link.title
Unemployment rate unchanged at 3.4% in August

# data[].attributes.attachment_link.description
PETALING JAYA: The unemployment rate in August 2018 remained at 3.4% for the three consecutive months, according to Statistics Department. During this month,

# data[].attributes.attachment_link.readable_text
The central bank said growth in the third quarter was supported by a 9 percent increase in household spending and 6.9 percent gain in private spending.

But the supply shocks from LNG and palm oil markets lowered growth for Southeast Asia's third-largest economy by 0.5-0.7 percentage point, the central bank said. The supply shocks have bottomed, it said.

For July-September the current account surplus narrowed to 3.8 billion ringgit.

Exports rose 6.7 percent in September from a year earlier, rebounding from a 0.3 percent annual drop the previous month, according to government data.

In the third quarter, Malaysia's trade surplus fell 4.1 percent from a year earlier to 25.2 billion ringgit. In April-June, the surplus was 27.2 billion ringgit, a 12.9 percent annual rise.

In its economic outlook report released two weeks ago, Mahathir's government forecast economic growth of 4.8 percent in 2018 - a sharp dip from last year's 5.9 percent - before inching up to 4.9 percent next year.

The government also abandoned a 2018 fiscal deficit target of 2.8 percent set by the previous administration, raising it to 3.7 percent, the highest since 2013. It expects moderation to 3.4 percent in 2019 and 2.8 percent in 2021.

The BNM governor said the central bank expects the ringgit to depreciate along with other regional currencies due to the strength in the U.S. dollar.

Inflation was largely benign in the third quarter, but is expected to edge upwards the rest of the year and into 2019, the central bank said.

Annual inflation rose 0.3 percent in September, a slight acceleration from a month earlier. The consumer price index rose 0.2 percent in August, the lowest rate since February 2015.

# data[].attributes.attachment_link.title
Malaysia's third quarter GDP growth slips

# data[].attributes.attachment_link.description
The central bank said growth in the third quarter was supported by a 9 percent increase in household spending and 6.9 percent gain in private spending. But the supply shocks from LNG and palm oil markets lowered growth for Southeast Asia's third-largest economy by 0.5-0.7 percentage point, the central bank said.

# data[].attributes.attachment_link.readable_text
It can create an equilibrium of low levels of workers and a large technological gap.

The Malaysian economy can be dragged by the brain drain in the country, Schroder revealed. If measures are not done, the firm noted that brain drain could create a trap wherein there is an undesirable equilibrium of low levels of human capital and a large technological gap.

According to a World Bank report cited by the firm, the rate of which one in 10 Malaysians leave home to work abroad is double the global average.

"Clearly, against a population backdrop of 28 million people, it (brain drain) signifies a massive loss of talent, and erodes an already narrow skill base that is lacking in compensating inflows of skilled migrants,"Schroder co-head of Asian equity alternative investments Robin Parbrook and head of Asian equities Singapore King Fuei Lee said.

According to a report from Malaysia's Department of Statistics, only 14.7 million are part of the labour force out of Malaysia's population of 31.7 million in 2016. Amongst the labour force, 27.3% are high-skill employees including those in managerial, professional or technician roles. Meanwhile, semi-skill workers and low-skill workers make up 59.7% and 13% of the labour force, respectively.

Three out of five said that social injustice is one of the top reasons why they prefer working abroad.

The analysts noted that one in three of the local Malaysian population is made up of Malays or the Bumiputra. The Constitutional law gives them access to special privileges including mandatory discounts on property, quotas for educational opportunities, preferential treatment for government contracts, and extra assistance when starting businesses.

"This often places the other ethnic groups, especially the Chinese, at a considerable disadvantage when embarking on their own economic progression paths, and conjures a strong feeling of unfair treatment and non-inclusiveness," the analysts commented."It is therefore not surprising that amongst the diaspora headed to the popular destination of Singapore, Chinese makes up the largest ethnicity," they added.

Also read: How will Malaysia's elections shocker affect bilateral ties with neighbour Singapore?

In 2010, the World Bank reported that 88% of Malaysian immigrants in Singapore are of Chinese descent. Meanwhile, those of Bumiputra and Indian descent make up 6% and 5% of Malaysian residents, respectively.

Through the years, the Malaysian government tried to address the brain drain through the 1Malaysia programme introduced in 2010 to provide employment and income generating opportunities for the poor and hardcore poor. They also established the Talent Corporation in 2011 to provide a hub where professionals, student, employers as well as academic and industry partners can find work that will be beneficial to them.

However, Schroder said that the initiatives to reduce brain drain have not been very successful. 1Malaysia Development Berhad (1MDB) is a product of the 1Malaysia programme which has been scrutinized by the new government as it was plagued with corruption and graft.

# data[].attributes.attachment_link.title
Workers' brain drain could lag Malaysian economy

# data[].attributes.attachment_link.description
It can create an equilibrium of low levels of workers and a large technological gap. The Malaysian economy can be dragged by the brain drain in the country, Schroder revealed. If measures are not done, the firm noted that brain drain could create a trap wherein there is an undesirable equilibrium of low levels of human capital and a large technological gap.

# data[].attributes.attachment_link.readable_text
AS the global economy continues to recover, labour force is improving, albeit at a slower pace.

Global unemployment in 2018 is projected around 5.5%, slightly better than 2017's reading of 5.6% on the back of a better global GDP outlook, with an expected growth of around 3.6% in 2018 from 3.3% in 2017.

# data[].attributes.attachment_link.title
Young and jobless in Malaysia - Business News | The Star Online

# data[].attributes.attachment_link.description
AS the global economy continues to recover, labour force is improving, albeit at a slower pace. Global unemployment in 2018 is projected around 5.5%, slightly better than 2017's reading of 5.6% on the back of a better global GDP outlook, with an expected growth of around 3.6% in 2018 from 3.3% in 2017.