ICT industry faces multipronged challenges: Pikom
By Edwin Yapp July 7, 2014
- Brain drain, declining enrolment, graduate unemployability may stymie industry growth
- Curriculum restructure, certification and awareness at schools needed to address issue
THE Malaysian information and communications technology (ICT) industry may be hampered from growing further as it continues to be plagued by some complex and vital issues that could lead to the derailing the nation's ambitions, cautioned the National ICT Association of Malaysia (Pikom).
Pikom chairman Cheah Kok Hoong (pic) said its latest ICT Job Market Outlook report has raised some pressing concerns, namely, the continuing brain drain experienced with fleeing Malaysian ICT professionals; the declining enrolment of computing science graduates at universities; and the unemployability amongst some of these graduates.
The study is an annual report produced and analysed by Pikom. This year's study was conducted in collaboration with recruitment portal Jobstreet.com and PayScale Human Capital, which provided various salary data. The report is also supported by the Multimedia Development Corporation (MDeC).
All data cited in the report is based on actual salaries paid to ICT professionals and not based on surveys, the association said. The salary comparison in the report applied purchasing power parity (PPP) adjustments to the figures reported in a bid to take into account inflation rates and fluctuations in foreign exchange rates, it added.
According to the report, countries in East Asia such as Vietnam and Hong Kong paid 2.19 and 2.12 times respectively higher than in Malaysia (click chart to enlarge).
Other East Asian countries that topped Malaysia included China (1.93), Singapore (1.73), and Thailand (1.54), while western nations paid as follows: United States (1.9), Canada (1.44), Britain (1.40) Australia (1.52), New Zealand (1.64).
These figures suggest that ICT professionals are in great demand globally and in the region, and this situation is expected to contribute to the overall brain drain phenomenon experienced by the country, Pikom said.
The data this year points to further widening of salaries experienced by ICT professionals working abroad, confirming a trend that previous reports for 2012 and 2013 had highlighted.
Another key issue highlighted in this year’s report was the significant drop in students enrolling in ICT courses since 2002. Citing data obtained from the Ministry of Education, Pikom revealed that there were over 119,000 students enrolled in ICT courses, with the production of 53,000 graduates in 2002.
However by 2012, both figures fell drastically to 80,000 and 19,500 respectively. Some of the factors Pikom said contributed to this decline are:
- The perception that the ICT industry does not offer a promising career, especially the disillusionment arising from the ‘dotcom bubble burst’ in the 2000s;
- A lack of current knowledge about ICT trends, opportunities and career prospects amongst school teachers and counsellors, which further dampens student motivation to take up the course; and
- The lack of professional certification and recognition within the ICT industry unlike what has been accorded to the medical, engineering and architectural professions.
On the demand side, the report also highlighted the lack of quality, competency and employability amongst ICT graduates as a crucial issue plaguing the industry. Only 10% of new entrants to the workforce are directly employable, while the remaining require re-training before they can fully undertake the work, the report noted.
Hard to compete with
Speaking to the reporters at a media event announcing the findings of its report last week, Cheah said the trends seen in the latest report are worrying but was quick to add that Pikom and MDeC had begun taking steps a number of years ago to try and address these issues holistically.
Conceding that these are complex challenges, Cheah said, “If this [trend] continues, it can potentially impact the national agenda under the 10th Malaysia Plan, which aims to boost the percentage of skilled workers up to 33% by 2015.”
Pikom research committee chairman Woon Tai Hai (pic) acknowledged that the brain drain phenomenon due to better salaries offered by countries globally and in the region is a difficult issue to combat, as there is nothing stopping qualified and skilled professionals to take offshore jobs.
Also the immediate past chairman of Pikom, Woon pointed out that Vietnam pays 2.19 times better than Malaysia and does so in US dollars, which he noted was something very difficult for Malaysian companies to offer.
However, Woon said there appeared to be a silver lining for the industry as this year’s study had shown that the average salary paid had increased by 7.2% from RM6,673 in 2012 to RM7,152 in 2013.
With the upward trend and an expected stronger economic growth forecasted this year, Woon said he expects the average salaries paid in the country to further climb 1.5 percentage points to about 8.7% in 2014.
“The imminent implementation of Goods and Services Tax (GST) on April 1, 2015 will also provide an impetus to the ICT industry as organisations ‘rush’ to replace and/ or upgrade their systems to be GST-compliant, resulting in a demand for software developers,” he claimed.
Next: Addressing these challenges and other study findings