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Why are salaries for graduates so damn low?

Malaysian engineer's earning is worst than a farmer!!

Recently, I received a spam e-mail from a recruitment firm looking for candidates to fill up executive positions in a call center at Cyberjaya.

First, I felt a bit shocked and insulted as the salary offered was between RM1,300 to RM1,800 for graduates with at least three years working experience. This was the starting salary I got many, many years ago as a fresh graduate!

What has gone wrong in Malaysia that the salary of graduates has been decreasing over the years? RM1, 500 at today’s value is equivalent to about RM500-RM600 in 80s after we factor in the inflation rate.

How can Malaysia grows to become a high-income country with such meager salaries paid to our graduates? We should ask Prime Minister Najib Abdul Razak for this ‘boleh’ phenomenon. I’ll give you my own analysis first before you get the rhetorical answer from the government.

Firms in the Cyberjaya are free to take in foreign workers, hence these employers have better bargaining power to suppress salaries for local fresh graduates. This is not the full story yet.

I also got to know that some foreign software engineers are paid RM20K to 30K per month by those same companies at Cyberjaya. Now I can say the influx of general purpose graduates from low-cost countries like India, China, Philippines etc. is pushing down the salaries for local graduates to unreasonable levels.

Besides, our local universities like Mara churn out a mass of uncompetitive local graduates under the name of the NEP. Mismatching in supply and demand for generalist and specialist engineers make things even worse.

I summarise the local graduate’s dilemma into two scenarios:

1. Local graduates are paid cheaply due to their low academic quality and lack of skill sets to meet market demand;

2. Local graduates with the right skills and experience are also under paid due to free and fierce competition from low-cost countries.

Whether you are a fresh or experienced engineer, you are a condemned loser under the present BN government policy which favours the employers and their low-cost foreigners.

This also explains why many Malaysian engineers and talent choose to work in overseas for better salaries.

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