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CHAPTER ONE

1.0 INTRODUCTION

Human labour assets, which are potential and focused in creating financial of a nation, are

required in this globalization period. Despite the fact that it is not composed in any organization

proclamation reports of any association, this sort of human capital is essential in deciding the

execution of an association in the nation. Without qualified human capital assets, a nation gets to

be distinctly frail as the absence of human component that can start new activities in financial

exercises. Nonetheless, creating human capital assets that are far reaching and at a world class

level is not a simple errand and it is a test to Malaysia. At present, unemployment among the

graduates turns into an issue, in Malaysia as well as in whole world.

The unemployment rate in Malaysia had increased 0.5% in 2009 based on The

Department of Statistics Malaysia (2011). Human Resources Ministry, Fong Chan Onn,

mentioned that the National Economic Action Council with the alliance of the Department of

Human Manpower had conducted a survey in 2005 and they have found that 59000 graduates and

diploma holders were unemployed after completed their degree meanwhile 30000 graduates

worked in a field that does not related with their higher educational studies. Based from resources

of job vacancies and job placement in Peninsular Malaysia in 2012, it is discovered that job

vacancies are increasing yearly. In any case, these occupations opening are filled by just a part of

the specialists. This demonstrates the unemployment issue is happened not in view of the absence

of openings for work rather it happens as a result of different variables, for example, the low

quality graduates created in advanced education organization.

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Despite the fact that the unemployment rate in Malaysia is viewed as low when contrasted

with nations like the United States and different nations in Europe, it is not an issue to be ignored

as the rate of unemployment builds step by step.

Since labour assets is fundamental in delivering a profitable and high-pay nation, this

paper expects to recognize elements that prompt to the unemployment issue among the Malaysian

graduates and thus it can ideally get to be rules in settling this issue from happen more quick..

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1.1 THEORETICAL FRAMEWORK

Graduates competency
Quality of education Factors affecting
Communication skills unemployment rate among
Choosing work attitude
Lack of Industrial training fresh graduates in Malaysia
Job Mismatch
English Proficiency

Figure 1: Factors influences the rate of unemployment of fresh graduates in Malaysia


2016

Based on the figure 1, generally the rate of unemployment of fresh graduates in Malaysia 2016

is influenced by several factors. Nasrudin (2004) in his article mentioned that there were six

factors that influenced the rate of unemployment of fresh graduates in Malaysia 2016. The factors

are mainly due to rapid increase of graduated workforce, lack of training for work preparation,

rapid increases of the population rate and rapid decrease of the mortality rate, educational

development, economic recession, and capability of graduates.

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1.2 FACTOR AFFECTING THE UNEMPLOYMENT OF FRESH GRADUATES IN

MALAYSIA

1.2.1 Rapid increase of graduate workforce

As technology increases these years, its been easier for all the students to enrol into

university and pursue their higher education especially in a private university. Therefore, the rate

of fresh graduates produced increases year by year thus provides a large force of graduate

workforce available in the market. When rapid increase in graduate workforce occurred, thus the

availability of the job in the market is limited. This cause the rate of unemployment of fresh

graduates increases yearly.

1.2.2 Lack of training for work preparation

Organizations of advanced education these days are more on syllabus premise. They

concentrate on instructing youngsters as indicated by themes and parts in a book. An understudy's

accomplishment is just being judged by their examination result, evaluations and CGPA which is

all examination bases. Subsequently the understudy themselves begin to disregard the reason for

advanced education which is to set themselves up to adapt to working world and they are more

centred around contemplating hypothesis and retaining stuffs for examination. In this way, the

new graduate that is being created is absence of preparing for work planning and causes the

unemployment rate increments.

1.2.3 Rapid increase of the population rate and rapid decrease of the mortality rate

Rapid increase of the population rate but mortality rate decreases also causes fresh

graduates to be jobless. This because there is limited job vacancy is offered daily in the country. If

those that is working till old, then the new generation will never get chance of applying that

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particular job. Besides, employers prefer employees with experience which means those that has

worked for years. This requirement actually reduces the chances of a fresh graduate to apply a job

at the moment. Besides, rapid increase of population rate means the population of fresh graduates

increases too. Therefore there are abundant amount of fresh graduates man force capital is

available in market but the job vacant is very less. This actually causes the rate of unemployment

of graduates to increase.

1.2.4 Educational development

Educational development in Malaysia is also one factor that affects the rate of

unemployment of fresh graduates in Malaysia. The main feature to the unemployment problem

among graduates is the failure of higher education institute to ensure the syllabus or curriculum

consistent with the matters required in the job market (Utusan Malaysia, 18th May 2005). The

universities abortive to provide curriculum and components of educational field that is required in

workplace skills. This causes difficulties among the graduates to obtain job that match their skills

and qualification. In general they are unable to implement what they studied in institute in real life

working field. This causes companies not preferred to hire fresh graduates from university and

they added the requirement where employees need to have few years of working experience.

1.2.5 Economic recession

Economy factor also one of the main reason fresh graduates are being unemployed these

days. For many years, the manufacturing sector has been the strongest sector in the country until it

is now being progressively replaced with service sector due to technology development. The

services sector requires people who do not only possess the right technical knowledge, but also

those who possess the right soft skills interpersonal, communication, wisdom, maturity and are

business oriented. But due to technology era, manpower is being replaced with computers and so

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on. This causes unemployment rate of fresh graduates increases. Besides that economic recession

would also cause fresh graduates to be unemployed. A recession will lead to drop in consumer

spending, affecting the business which lay off workers due to losses. A recession occurs when

there are two or more consecutive quarters of negative gross domestic product (GDP) growth.

This means economic growth is slower during these periods which lead to fall in sales, stock

prices incomes and maybe bankruptcy also. Thus the rate of unemployment of graduates increases

during these periods.

1.2.6 Capability of graduates

The capability of graduates is being questioned and this is one of the main factors of

unemployment of fresh graduates in Malaysia. Due to concentrating to much in excelling in

education part, these graduates failed to improve their soft skills qualities such as technical skills,

problem-solving skills and communication skills, especially in English language and also in the

aspect of management, problem-solving, communication, leadership, creativity, critical thinking,

proactive, self-confidence and interaction skills which is important in working life. Thus this

causes employers not to prefer to appoint a fresh graduate in working places. They prefer

someone with experience as those employees are well known with working environment. Besides

that, graduates find it hard to cope with new working environment once graduated as what they

studied and what they implement is two different things. Furthermore, these graduates are lack of

confidence during attending interviews because they have never gain experience in such a

situation. All these leads to unemployment factor of fresh graduates in Malaysia.

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1.2.7 English Proficiency and Communication Skills

According to a research conducted by the National Higher Education Research Institute

(IPPTN) on February 2003, it is revealed that Malaysian fresh graduates are fragile in command

of English language and communicating in this language, thus graduates are having difficulty to

communicate which leads to low interpersonal relationship (Wei, 2011). In addition, according to

survey of human resource personnel and bosses conducted by Jobstreet recently, a Malaysian

employment agency in 2005, the survey shows the main problems faced by employers in hiring

fresh graduates were poor command of English language of 56% (Ministry of Higher Education

Malaysia, 2012).

1.2.8 Choosing Work Attitude and Job Mismatch

Based to research conducted by National Higher Education Research Institute (IPPTN) on

February 2003, reveals that Malaysia graduates are passive and have no initiative and less

independent finish their job, and some graduates have attitudes problem, too choosy in jobs, arent

able to work as a team, not willing to learn, selfish and demand for high salary (Wei, 2011).

Furthermore, based on Job street, a Malaysian employment agency in 2005, the survey shows the

main issue faced by employers in Malaysia in hiring fresh graduates were poor character, attitude

or personality with 37%, demanding of salary with 33%, irrelevant Degree or job mismatch with

30%, fresh graduates too choosy selecting jobs and company with 27% and no suitable job

opportunities with 16% (Ministry of Higher Education Malaysia, 2012).

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1.3 Problem Statement

Unemployment issue in Malaysia

According to Rahmah et al. (2011), one of the factors that contribute to the unemployment

problem among the Malaysian graduates is the quality of the graduates itself. The employers in

the labour industry have given negative comments on the employment of fresh graduates and

mentioned that these graduates do not have the suitable skills and qualifications, which meet the

needs of the industry at the end of the day. Furthermore, the graduates are poor in the aspect of

employability skills and do not show a good working performance. A study conducted by Central

Bank of Malaysia in year 2002 has found that the Malaysian graduates are less skilled as

compared to the international graduates from overseas. These skills include technical skills,

problem-solving skills and communication skills, especially in English language.Ten primary

weaknesses of Malaysian fresh graduates are in the aspect of management, problem-solving,

communication, leadership, creativity, critical thinking, proactive, self-confidence and interaction

skills (Ranjit,2009). These features lead to the difficulties for the graduates in obtaining jobs,

which meet their educational qualifications as well as their soft skill qualification. There are also

job industries reporting that the reason for job vacancies in a working field is because of lack of

fresh graduate candidates, who are qualified for the posts which required experience more than

educational qualification they possessed. This is shown from a report by National Associated of

Manufactured (NAM), in which it is revealed that there are gaps exists in the range of skilfulness

in almost all of the working fields (Kahirol et al., 2008).

Subsequently, this is the reason that makes an interviewed candidate is not selected to gain

the post as the candidate do not meet the requirements by the industry. Consequently, the

graduates are facing problems in gaining a place in a working world, as they are not able to

compete and give a full commitment to a work. This matter is regretted because the inability for

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the Malaysian graduates to fulfil job vacancies in Malaysia resulting in the hiring of foreign

workers. Currently, a good academic achievement is no longer a guarantee for the Malaysian

graduates to get a job (Noor Azina, 2011). It is a benefit for the graduates but it is not a guarantee

for them to be given jobs.

Since there is a big gap between the quality levels of the Malaysian graduates with the

international standard, this matter needs to be handled in order to ensure that our country has

skilled, versatile and marketable graduates (10th Malaysian Plan, 2010). Based from a human

capital theory by Becker (1964) it is stated that human capital that has a high knowledge and skills

contribute to the increase of the countrys economic productivity. Becker (1964) also stated that a

high investment in producing useful human capitals is important as long as it give high and

positive impacts to the economic productivity. Therefore this study is conducted to identity causes

the rate of unemployment among graduates in Malaysia so that this problem can be cope by 2020.

1.4 Objectives of the studies

The objectives of this study are divided into two parts which is general objective and

specific objectives. The general objective and specific objective will be identified in the

following.

1.4.1 General Objective

The general objective of this research is to study the factors that influence the rate of

unemployment of fresh graduates in Malaysia 2016.

1.4.2 Specific Objective

The speedy increase of graduated workforce, lack of the relationship between educational

institutions and the industry, lack of training for work preparation, rapid increase of the population

rate and rapid decrease of the mortality rate, educational development, economic recession, and

capability and quality of graduates

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To identify the rapid increase of graduated workforce will affect the unemployment rate of

fresh graduates in Malaysia.

To identify the negative impact caused by lack of training for work preparation of fresh

graduates with the rate of unemployment in Malaysia 2016.

To identify the rapid increase of the population rate and rapid decrease of the mortality

rate will affect the rate of unemployment of fresh graduates in Malaysia 2016.

To evaluate the effect of educational development with the rate of unemployment in

Malaysia.

To determine whether the economic recession affects the unemployment among the fresh

graduates in Malaysia 2016.

To measure whether the capability and quality of graduates will affect the unemployment

rate in Malaysia 2016.

1.5 Significant of the Study

The significant of the study is to overcome the increase in rate of unemployment of fresh

graduates in Malaysia year by year. This research also gives a benefit to graduates to find the

factor of unemployment and develop their self in the particular field during job search. Thus this

will increase the productivity and growth of the country.

1.6 Scope and Location of Study

The scope of this study is segmented to the fresh graduates in Malaysia year 2016. To be

specified we will only take count of fresh graduates from ALUMNI UNIMAS for more detailed

information during their job seeking moment. Location will be in Kuala Lumpur as currently we

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are limited with resources, time and cost. So Kuala Lumpur will be the perfect location of study as

it is the city centre where graduates from all over Malaysia seeks job.

1.7 Limitation of Study

There were some limitations with respect to the analysis and data that may affect the

accuracy of the results.

Due to sample size, a small sample size has a greater probability that the observation just

happened to be particularly good or particularly bad. Therefore it is harder to find significant

relationships from the data, as statistical tests normally require a larger sample size to justify that

the effect did not just happened by chance alone.

Besides, the questionnaires that fill by respondents would have some bias. It would be

more accuracy if the researcher can interview respondent directly. Furthermore, it would have

some difficulties to approach the respondents because they felt weird upon strangers and give

cooperation to the unknown people.

Moreover, it would be difficult to get the questionnaire all back as some of the respondent

do not realize the important of the research and did not wanted to fill the questionnaire as

respondent though that it is wasting their time.

Finally, cost and time became a heavily limitation to complete this study. Taking a good

respondents sample would have been indeed a costly and time-consuming activity. If cost and

time were allowed to be increase, greater volume of respondents participate in this study and thus

the validity of the result would also increase.

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CHAPTER 2

2.0 Introduction

This chapter reviews some concepts related to the topic of this study based on past

research studies. It includes perception of other researchers and the publics opinion pertaining to

factors affecting the rate of unemployment of fresh graduates in Malaysia. In this chapter, we took

five articles to support the factors that been identified in this research paper as the factor of

unemployment rate in Malaysia. These five articles Zaliza Hanapia, Mohd Safarin Nordinb, and

Ridzwan Che Rusc (2014) ; Che Mohd Zulkifli Che Omar and Shanmuganathan Rajoo (2016)

;Mohamad Idham Md Razak, Asliza Mohd Yusof, Wan Nor Syazana, Wan Effa Jaafar, and Adi

Hakim Tali (2014); Dr. Noor Azina Ismail (2011); and Rahmah Ismail, Ishak Yussof and Lai Wei

Sieng (2011).This chapter will discuss about what each research paper is talking about the factor

that affects the rate of unemployment of fresh graduates in Malaysia and will be used in this

research paper.

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2.1 Unemployment Problem in Malaysia

About 3.5 percent tremendous increase of unemployment rate in Malaysia in

September 2016 from 3.3 percent a year earlier. The number of jobless persons rose by 4.5

percent or 22.3 thousand to 512.6 thousand people. Employment went up by only 0.7

percent or 97.9 thousand to 14249.6 thousand. The labour force increased 0.8 percent or by

120.2 thousand to 14762.2 thousand. On a seasonally adjusted basis, the unemployment

rate was 3.6 percent in September, similar to the previous month Unemployment Rate in

Malaysia averaged 3.27 percent from 1998 until 2016, reaching as high of 4.50 percent in

March of 1999 and a record low of 2.70 percent in August of 2012;Source of Department

Statistics Malaysia (2016). Fresh graduates have some catching up to do as employers are

not too happy about their quality levels. A significant 70% of respondents said that the

standards of fresh graduates were just average, while 24% believed that they were bad and

only 6 % said they were good ; JobStreet (2015).

2.2 Unemployment Problem among Graduates of Technical Field

Unemployment does not only happen in Malaysia but it is a worldwide issue that

occurs due to many unidentified reasons. According to Zaliza, Mohd Safarin, and Ridzwan

(2014), graduates competency and quality of education are the important factors in

increasing of unemployment rate of fresh graduates in Malaysia. The authors have

specified that the rate of unemployment is related to the learning and curriculums of the

programmers offered in educational institutions.

2.2.1 Graduates Competency

It emphasized that competency consists of five characteristics which are skills,

knowledge, self-esteem, motivation and attitudes in doing a task. They have mentioned

that technical skills need to be mastered by the graduates in order to be employed in the

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industry. Meanwhile employability skills which are called as non-technical skills, soft

skills, generic skills, key skills and core skills are required for fresh graduates in order to

be employed once completed their higher education. Most of the graduates that being

selected based from employers perspective found that most employers are concerned with

employability skills such as creativity, innovative, problem solving, cooperation,

information management and entrepreneurship in order to be hired. The is very important

for a employers to find workers who have employability or job readiness skills that help

them fit into and remain in the work environment is a real problem. Employers need

reliable, responsible workers who can solve problems and who have the social skills and

attitudes to work together with other workers and provide genuine progress and betterment

for a company or business.

Most graduates have no issues in term of technical skills and employers are

satisfied with their technical skills (Syed Hussain, 2008). However mentioned that these

graduates have problem in term of non-technical or employability skills such as project

management skills, team working, communication skills and entrepreneurial skills. Syed

Hussain (2008) revealed that 62.3% of the technical graduates are unemployed due to lack

of employability skills compared to technical skills. Employability and technical skills are

indeed compulsory criteria among graduates of higher education to enable them to be

offered a job once graduated. These interpersonal skills were very important to build

relationships, ensure the sharing of new ideas and best practices, and benefit to companies

throughout services.

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2.1.2 Quality of Education

Quality of education is one of the factors that affect the rate of unemployment. The quality

of education is hard to be measured thus they define it as the product of learning outcomes from

the higher educational institution itself. The quality of education is depending on the quality of

teaching and learning process, educational facilities and infrastructures, well-planned curriculum

and an effective implementation of the curriculum. Higher education is considered a key to

graduates career development (Thete, 2003). The increasing number of the public and private

educational institutions in Malaysia results to a competition among the educational institutions

and the increase of unemployed graduates. According to Hoy and Miskel (2005), a good higher

education institution consist of leadership, classroom climate, quality of curriculum, structured

teaching, effective learning time, achievement-oriented and recognition of success of the student

in it. Ministry of Education (2010) has set five standards in Malaysian education system such as

the leadership and direction, organizational management, curriculum, co-curricular and sports,

student affairs, teaching and learning process and student excellence. The key factors affecting

educational quality are the quality of teaching, the content of the program and the evaluation by

the trainers according to Harvey (1993)

The research of this particular article is mainly on educational quality in terms of

curriculum studies and teaching and learning. Tang (2002) also said that the evaluation of

teaching effectiveness is one of the ways of measurements that can be conducted to measure the

quality of teaching and learning. According to Deputy Human Resources Minister Datuk Abdul

Rahman Bakar has stated that the main contributor of unemployment among graduates is due to

failure to match educational syllabus or curriculum with the job market requirement (Utusan

Malaysia, May 18 2005). Curriculum and subjects thought in university is not in line with

workplace literacy required in working field industry. Thus this affects the employment of

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graduates as their competency of being employee is being questioned in the industry due to the

quality of education.

2.2 Unemployment among Graduates in Malaysia

Labour market has become more dynamic with technology increases and it reduces the

industrys need of employer in the era of globalization. This lead to competition among graduates,

employed at-will employer or not in accordance with the level of education in the end it leads to

the problem of unemployment. The unemployment is related with economic development that

should be addressed in the labour market. Unemployment can happen for short or long term. The

author has mentioned few factors of unemployment in this article such as communication skills,

choosing work, experience and lack of industry training.

2.2.1 Communication skills

Malaysia acknowledges the high importance of English Languages yet graduates from

public universities in Malaysia encounter challenges in speaking, writing, reading, and listening in

the English language for job-related tasks at the workplace(Carol et al., 2011). Carol has

mentioned that graduates still find it difficult to converse in English during job interview which

causes the employer to be doubtful in hiring graduates. This happens because private sectors in

Malaysia comprises of multinational companies and international subsidiaries, thus they prefer of

recruiting graduates that is fluent in English. Employers believe that graduates that are fluent in

English are high skilled and more effective in improve the productivity of the company. A study is

conducted where 50 companies in the state of Selangor and Perak prefers employees that are

fluent in English during recruitment of job (Wei, 2011). Therefore, graduates have to give priority

for English proficiency and communication skills in order to get hired in the industry.

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2.2.2 Choosing work

Graduates nowadays are being too choosy when it comes to applying job. The choosy

attitude of the citizens of this country is one of the reasons of unemployment of graduates in

Malaysia (Human Resources Minister Dato Sri Richard Riot Anak Jaem). A lot of planning was

held for graduates to avoid unemployment by government as well as government-linked

companies (GLCs) and private companies. But these graduates ignore this business opportunities

that is exist due to their choosiness. These graduates tend to look for suitable jobs and promising

salary which is commensurate with their academic qualification they possessed. Besides that,

they also do not go for jobs which are not in their field of study. They prefer to work on the same

field of their studies which causes their choices of jobs reduces. This causes the rate of

unemployment increases over the years.

2.2.3 Experience

The rate of unemployment increases rapidly due to the factor of experience. Nowadays, a

person who wants to get a job must have work experience and preferably in that particular field.

Private sectors always prioritize candidates that have working experience compared to highly

qualified graduates but experienced only in theory. This attitude leads to unemployment of

graduates mainly those that freshly graduated from higher education institution. The new

graduates are not given an opportunity to prove their knowledge and skills as many employers

does not want incur any loss due to hiring graduates that are lack of experience in working sector

For employers, experience is very important to facilitate the work. Experience is important

because employers do not need to use their resources to facilitate fresh graduates on training.

Experienced workers are already have required skills, thus is more preferably to be employed.

This helps to reduce costs need to be expensed by the employer. But this action has leads loss to

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the country because unemployment rate has increased and the amount of income per capita

decreases.

2.2.4 Lack of Industrial Training

Lack of industrial training is one of the factors that affect the rate of unemployment of

graduates (Wei, 2011). The lack of industrial training which is in period of 3 -6 months provided

by public education institutions in collaboration with companies and non-governmental

organization does not help these graduates to face the real challenges in the working industry.

Since these graduates does not get the real life exposure associated with job prospects and does

not meet the standard, they are not capable of getting jobs once graduated from the institution.

Besides that, they also have high competitions between graduates from other association that also

provide different training industry. Furthermore, there are many courses are offered in private

institutions that are not recognized by the government because hundreds of institutions grown like

mushroom after rain. So these study institutions are more concerned of profit that the quality thus

causes the graduates not to have a proper training in working field. This leads to unemployment

rate to increase.

2.3 Factors influencing Unemployment among Graduates in Malaysia

Unemployment is an important problem that many developing countries are facing the

developing phase. Nation with high unemployment indicates that the human force resource is not

fully developed to achieve maximum production output. Therefore the author has considered that

unemployment as macroeconomic issue. Deputy Human Resource Minister, Datuk Ismail Abd

Mutalib mentioned that Malaysia has achieved full employment by having unemployment rate

which are less than 4%. But unemployment issues among graduates are still unresolved over the

years where 65,500 graduates were recorded unwaged which are 16.7% of total labour force in

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2010 based on Department of Statistics. These three factors are being researched in this paper to

know the influence of it in unemployment in Malaysia.

2.3.1 Job Mismatch

Job mismatch is one the common topic is discussed when it relates to unemployment of

graduates from higher education institution. Job mismatch also can be defined as qualification

mismatch as it occurs at the level of formal education a worker possesses deviates from the job

requirement and skill mismatch occurs when the employer possesses higher or lower level of

skills than required to perform the particular job (Berlingieri & Erdsiek, 2012).The phenomenon

of job mismatched can be divided into 3 categories (Shujaat Farooq, 2011). Firstly, there is job

mismatch compared to graduates education level, then job mismatch compared to graduates

qualification, and finally job mismatch compared to graduates field of study. Job mismatch in

education is based on how distinguish the education a graduate poses with the education required

in the field of work he is working. Besides that, job mismatch in qualification is also determined

based on level of qualification a graduate poses with the field he is work in with the job

description. Additionally, it poses by relating the individuals field of study with their job content.

In this paper, job mismatch as a factor that influences unemployment among graduates in

Malaysia.

2.3.2 English Proficiency

One of the major contributions towards unemployment among graduates is the lack of

English language proficiency (Md Yassin et al., 2010; Sharif, 2005). Based on survey , most of

fresh graduates and employees are lack in English language skills. English language proficiency

and communication skills are very important for graduates to enable the graduate to be employed.

According to the Association for Academic Language and Leaning (AALL) (2009), English

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language proficiency is defined as the students ability in using English language to communicate

with others either vocally or in written context by using correct grammar and sentences structure

Currently, higher institutions grow concern of employability of graduates due to their lack

of proficiency in English. Thus government has set requirement and exams such MUET test for

students before pursue their higher education to increase their awareness of the importance of

knowing English language proficiency. MD Yassin, et al (2010) proved that English proficiency

has significant influence of unemployment among graduates in Malaysia.

2.3.2 Employability skills

Lack of employability skills among graduates below from the employers expectation has

become one of the reason of most graduates are being unemployed. The capability of an

individual to secure an employment according to their individual education background is defined

as employability. (Wickramasinghe &Perea, 2010; Dearing, 1997). Furthermore, skills are defined

as a set of characteristics which includes knowledge, attitudes, and behaviour that contributes to

individuals to be employed (Zarina, et al, 2011; Norshima Zainal Shah, 2008). While,

employability from the employers perspective denotes as work-readiness which is the skills,

knowledge, attitude and profit-making understanding possessed by a graduate enables them to

contribute in achieving the organizational goal (Zarina, et al., 2011; Mason, Williams, & Cranmer,

2006). In this era, graduates are being expected to attain all the necessary skills and knowledge to

meet their employers expectation prior to their university days. However, not all graduates

employability meets the employers expectation and thus this cause to unemployment among

graduates occurs.

The research has determined the relationship of employability that influenced

unemployment among graduates in Malaysia. Their show there is a good correlation in

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employability skills. Furthermore, there is a significant relationship between employability skill

and unemployment among graduates which the significant (2 - tailed) is 0.00 levels. Rosenberg,

Heimler & Morote (2011) has proved that employability skills have influence on unemployment

among graduates in Malaysia.

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2.4 Conclusion

This study showed that having good scores did not guarantee employment for Malaysian

graduates. Effective skills training will produce graduates who are educated and skilful before

entering the working field. Moreover, it will also produce graduates with a good working ethics,

proactive and able to solve problems related to the work. Pang (2011) mentioned that there are

three primary strategies to construct an integrated human workforce, which is by; restructuring the

educational system in order to increase the students achievement, increasing the graduates skills

in order to increase Malaysia is aiming to become a fully developed nation by the year 2020.

Therefore, an English language is relatively important for cross cultural communication involving

international participation. This study also discusses the issue of unemployment among graduates

and how to overcome them. Less communication skills, soft skills and experience working and

rather choose employment to issues of unemployment among graduates in Malaysia. Although

unemployment is not as grave as its looks as reported by The Star (2013, 23 October) as Malaysia

is said to achieve full employment as the unemployment rate is below 4 %. Future graduates

should not take this casually as the number of unemployed graduates is moderately increased

through the year. Future graduates should take the opportunity of internship program as a training

ground to improve their employability skills and try to make the best out of it (Yusof, Mohd

Fauzi, Abidin, Awang, 2013).

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CHAPTER 3

RESEARCH METHODOLOGY

3.0 Introduction

This part is discusses the method had used in this study. The scopes of the discussion

include research design, research methods, data sample and collection and data analysis.

3.1 Research design

This study conducts a descriptive research to examine the issues that affecting

unemployment rate among fresh graduates in Malaysia. In this study, independent variables are

graduates competency, quality of education, communication skills, choosing work attitude, lack of

industrial training, job mismatch, and English proficiency. The dependent variable is

unemployment rate.

In this study, a survey is conduct to gather primary data. A survey is a data gathering

method that is utilized to collect, analyse and interpret the views of a group of people from a

target populations (Mae Sincero, 2015). Some questionnaires are structured checklists and have

pros and cons.

The questionnaires are a quick and efficient way to obtain information from a large

number of respondents. It is less of costly then interview hundreds of respondent. The whole

questionnaire consists of close ended question study and involves only single cross-sectional

questionnaire for the information obtained. Paper questionnaires survey was a versatile method

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because it is compatible to all respondents. Besides, the face-to-face technique is conducted when

distributing questionnaires because it is easy for researcher to explain the purpose of the

questionnaire to respondents and can collect back the questionnaires on the spot.

Graduates competency

Quality of education

Communication skills Independent


Choosing work attitude variable
Lack of industrial training

Job mismatch

English proficiency

(Figure 1: Research Model)

3.1.1 Sampling Design

Sampling is the primary stage of selecting an adequate number of elements from the

population. Besides that, sampling is also concerned with the selection of a subset of individuals

from within a statistical population to estimate characteristics of the whole population. The

research study focuses on factor affecting unemployment rate among fresh graduates in Malaysia.

The population or population of interest is the total group of people from whom we need to obtain

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information (McDaniel & Gates, 1995). Sampling has done because it is impossible to test every

individual in the population research. Besides that, sampling also can reduce time, money and

effort when conducting the research.

The sample of research mainly focused the respondents in Klang Valley area. The

respondents include many types ethic like Malay, Chinese, Indian, and other types. The research

focused respondents from Klang Valley area due to limited time frame to complete this research

proposal. Klang Valley is also suitable focus area for this research because many industrial and

work places located in that area. In this study; the targeted respondents are focus on employed

fresh graduates and non-employed fresh graduates. Through this survey, we will know the factor

that will affect unemployment rate in Malaysia. The questionnaire will be distributed randomly to

both private and public sectors based companies to identity fresh graduates whom employed and

UNIMAS Alumni 2015 to identify fresh graduates whom unemployed.

3.2 Research sample

The sample for the research would be including the respondents from public sector, private

sectors and UNIMAS Alumni 2015.

The targeted respondents for this study are focused on fresh graduates whom employed

and unemployed. They will be a good representation in this study since they are more positively

correlated to be employed or unemployed after completed studies. Thus, the respondents are

selective. The basic assumption of most survey research is that, by carefully following certain

scientific procedures, one can make inferences about a large group of elements by studying a

relatively small number selected from the larger group (Connaway & Powell, 2010).

According to Alreck and Settle (1985), for populations of 10,000 and more, most

researchers would probably consider a sample size between 200 and 1,000 respondents.

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Therefore, in terms of time and cost considerations, a convenience sample of 200 individual

consumers who had been using hand phone before are approached to collect data.

3.3 Data collection method

To conduct the study, primary data and secondary data are used by the researcher to

analyse factor affecting the unemployment rate in Malaysia. Primary data was collected by using

self-administered questionnaires which were distributed to respondents who were briefed on the

purpose of the study. The questionnaires can be consisting of open-ended questions and closed-

ended questions. However, the closed-ended questionnaires choose in this study because open-

ended questions were more difficult to code and analyse. The structure of the questionnaire is

clear, easy to understand, and straightforward to ensure that the respondents could understand and

answer the questions easily.

The 200 sets of questionnaires are distributed to friends whom been employed and yet to

be employed after completing higher studies. The questionnaires are distributed to respondents

manually by own. All questionnaires were distributed within the Klang Valley area which is

mainly employed and unemployed fresh graduates were living. Researcher delivers all self-

administered questionnaire to respondents by hand at the same time will be collected back.

3.3.1 Primary Data

Primary data is information that collected specifically for the purpose of research paper. In

the research, the data would analyse by the descriptive for the data that quantitative such as the

demographic part.

Besides, this research would explore the factors affecting unemployment rate among fresh

graduates in Malaysia. These factors are constituted graduates competency, quality of education,

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communication skills, choosing work attitude, lack of industrial training, job mismatch and

English proficiency. Moreover, to achieve the objective of the research, researcher would try to

identify the main factor by using the mean of each factor. The data would analyse thoroughly to

make sure it can achieve the objective of the research. The sample of the questionnaire is showed

in the Appendix.

3.4 Instrument development

Questionnaires

The questionnaires will the basic in the research as in evaluating the features that affecting

unemployment rate among fresh graduates in Malaysia. The questionnaire will be divided into

three sections which consists general information about respondent, graduates who are working

and graduates who are not working yet. The closed question would be the demographic profile of

the respondent while the open question would be using the 5-point Likert Scale question.

The summated rating scale, more commonly known as Likert Scale, is the easiest to

construct. This scale is based upon the assumption that each statement/item on the scale has equal

attitudinal value, importance or weight in term of reflecting on attitude towards the issue in

question (Kumar, 2005). Each element will be tested on 5 point scales in which 1=strongly

disagree, 5=strongly agree.

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Direct and indirect causal relationship

Factors affecting Unemployment


rate among fresh
graduates in
Malaysia

Graduates competency

Quality of education

Communication skills

Choosing work attitude

Lack of industrial training

Job mismatch

English proficiency

(Figure 2: Direct and indirect causal relationship)

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3.5 Hypothesis

This study is aimed to identify the factor affecting unemployment rate among fresh

graduates in Malaysia. Multiple-choice questions and Likert scale used as questions for this

research. The researchers provide a choice of answers and respondents are asked to select one or

more of the alternative given. Then, the Likert scale is a measurement scale with five response

categories ranging from strongly disagree to strongly agree which requires the respondents to

indicate a degree of agreement or disagreement with each of a series of statements related to the

stimulus objects. There are several statistical techniques that can be used to analyse collected data

such as frequency analysis, reliability test, descriptive statistics, correlation test and regression.

This chapter focuses on the research methodology which is the exploratory, descriptive

and causal research design. It is also included the information of the sampling technique and data

collection method as well as the data analysis that has been use in this study.

Therefore, construct our hypothesis which read as follows:-

Remarks : represents of list factor affecting ( graduates competency , quality of

education, communication skills, choosing work attitude, lack of industrial training, job

mismatch and English proficiency) of unemployment rate among fresh graduates

H0: There is no significant impact of to unemployment rate among fresh graduates

H1: There is significant impact of to unemployment rate among fresh graduates

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3.6 Practical and ethical Issue

In this research, researcher had learned the criteria in writing research proposal. In

research proposal, it is including introduction, problem statement, objective, research method,

significance of study and so on. Researchers also work as team and responsible to own

responsibility to accomplish this research. Before develop the questionnaire, researchers will

brainstorming to get the input to develop the questionnaire. Researchers will update their work

progress and make sure all the work go smoothly according to their schedule. Besides, researchers

need to come out with questionnaire and give to respondents for their research.

Besides, in composing research report, analysts are getting the data from a large portion of

auxiliary information that get from many wellsprings of diary. Specialists are carrying on genuine

and dependably think deliberately when build up the poll. At the point when scientists are

dispersing the survey to respondents, analysts will converse with them cordially, clarify plainly

about their motivation on research to respondents and regard on respondents' right side. For

instance, if the respondent doesnt willing to fill the poll, the analyst won't constrain the

respondent to do as such. Specialists additionally ought to act morally analysts can't help the

respondents to top off the poll. All the data inside the poll is secretly. Analysts are communicating

their appreciation towards the respondents for their co-operation.

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