11/2017 – Dropouts and the changing economic environment

by Tan Thiam Hock

Saturday, 27 May 2017

LATELY there have been many discussions on how e-commerce, robotics and Artificial Intelligence will disrupt the human workforce causing massive unemployment all over the world. We are already witnessing, high unemployment among the youths in Europe and even in Malaysia where we have at least a hundred thousand unemployed graduates.

There seems to be a massive disconnect between education output and employment requirements in Malaysia. Language, spoken and written is one major problem. The Malay youth speaks only in Bahasa Malaysia and the Chinese youth speak only in Chinese language.

For the so called developed nations in Europe, slow economic growth presents fewer job opportunities with some countries having a 25-50% unemployment amongst its youth.

Much has been discussed about our local education curriculum and its relevance in this increasingly digital economy. With a bloated civil service, the government cannot afford to hire all unemployed graduates like they used to. As such, our education system must restructure its curriculum to meet the needs of the new economy especially the private sector employers.

Since I have been profiled as a Malaysian Chinese, my discussion today will revolve around Chinese youths in this country. Ever since the NEP, places in local universities for Chinese students have been on a quota basis and due to insufficient places, many students opt for local private universities ranging from TAR College to Sunway and Monash. Since these universities charge substantial student fees, they have managed to hire some of the better lecaturers.

My experience of hiring local university graduates has been quite pleasant and some of the girls have actually gone on to high profile jobs within the cosmetic industry. Except for a few, most local universities are pretty well run and good value for money. For the well to do, the children are sent overseas, some from A-Level onwards. Again overseas scholarships are hard to come by for Chinese youths.

The PTPTN loan from the government is a major help to many not so well to do families. It is a pity that students who have graduated do not pay back their PTPTN loan as they are denying future students from gaining a university education.

My main concern is not with the Chinese school-university graduates. With so many major investments from China, there will be tremendous opportunities for graduates who can speak and write Mandarin. Only 30% of all Chinese school students proceed to Sixth Form and universities. I am worried for the 70% dropouts after Form 5. What kind of job opportunities do these young kids have, barely 17 years old?

The boys will most likely become salesmen either in distribution companies or selling phones and accessories in IT malls. Some will work for their parents, many helping out in the wet market stalls run by their parents, which is not too bad as he can then takeover the small business and make a decent living for the rest of his life.

As for the girl dropouts, many will become sales promoters for cosmetic or beer companies. Some will join hair salons or become beauticians. There is also a growing number of girls joining as sales reps in insurance or distribution companies now competing with the guys. In my cosmetic line, the female sales reps are tenacious, hardworking and detailed in their jobs.

It would not be improper of me to ask the Chinese schools to help prepare these 70% dropouts for working life, putting in the same effort as they would help prepare the better students to get to universities.

I also would like to see the various Chinese business associations set up technical and vocational schools for automotive mechanics, plumbers, electrician, air con technicians etc.

For those of you who have encountered house calls by plumbers and technicians, you would have noted that they charge by the hour with a minimum charge of RM100. In London, it is very difficult to get such technicians to do house calls as they are always fully booked.

What our Form 5 dropouts should do is to join as an apprentice and learn the tricks of the trade. If the various associations e.g. aircond, etc can set up vocational schools the apprentice will be able to learn on the job and attend classes to achieve proficiency ending up with a valuable certificate. Eventually he might want to branch out on his own.

The Chinese community in Malaysia forms the backbone of SMEs. As an SME, the entrepreneur works hard with extremely long hours just to support the family, putting a roof over the head and food on the table. You do not have to depend on handouts and social welfare if you are willing to get your hands dirty. When you have technical skills, it is not difficult to make a living. Survival is all about self sufficiency.

The other major concern that I have is the disruption of e-commerce on our local importers and distribution businesses.

The whole value chain will be disrupted especially the Malaysian Chinese traders that are currently importing from China, their distributors and the retail stores that they sell to. Once Alibaba brings in the goods made in China and sells the products at half the price, these Chinese businesses will be the first to disappear.

As hand phones and accessories are the best sellers on e- commerce, many Malaysian Chinese youth will join the unemployment ranks. Can we get these youths to sacrifice the comfort of an air conditioned mall and get them to learn some technical skills that dirty their hands?

I really hope all the various Chinese chambers of commerce in Malaysia monitor the changes that are coming to our shores.

They should have in place some strategies to help their members ride through the rough patches and offer them some alternative solutions. What is more important is how do we help these Form 5 dropouts find their place in society giving them an opportunity to earn a decent living in an increasingly difficult environment. If we do not help ourselves, nobody would.

Published: http://www.thestar.com.my/business/business-news/2017/05/27/dropouts-and-the-changing-economic-environment/

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