PETALING JAYA: Even fresh graduates have not been spared salary cuts. New entrants into the job market are now starting at RM1,000 a month, half of what was offered in 2019.

The severe economic downturn caused by the pandemic is the main contributory factor, according to employers and economists.

Most graduates are now being paid RM1,001 to RM1,500 on their first job, and at the lower end, it is even below that of the official minimum wage of RM1,200. In 2019, the rate was RM2,001 to RM2,500, according to new data released by the Statistics Department.

Malaysian Employers Federation executive director Datuk Shamsuddin Bardan said the labour market remained weak even in the first quarter of 2021.

“Employers are still grappling with challenges of resuming operations. Most are not able to offer long-term employment as they are still unsure of the sustainability of their businesses,” he told theSun.

However, this is a temporary measure and with the recovery of the economy, starting salaries of graduates would be back to market-rate levels, he said.

“As forecast by Bank Negara Malaysia in its annual report, the economy is expected to grow by 6.0% to 7.5% in 2021 as employers regain business traction, aided by government initiatives.

“As the economy recovers, the return to market rate for graduates will be realised as determined by forces of supply and demand.”

Likewise, he noted new entrants to the job market must be prepared to face challenges of a weak labour market and hiring trends of companies as they grapple with business sustainability.

“The starting salary for new entrants to the labour force may be low but salaries will be reviewed upwards when employers recognise their skills and contributions.”

Shamsuddin agreed with Minister in the Prime Minister’s Department (Economic Affairs) Datuk Seri Mustapa Mohamed that graduates “should be grateful that they are able to get jobs in a struggling economy” even if they have to start at a low salary.

“Securing employment, be it full time or part-time, should be the priority for fresh graduates to gain necessary experience and skills.”

Emir Research head of social, law and human rights Jason Loh said low starting salaries does not come as a surprise given that wage levels have remained stagnant since the 1980s.

“In the meantime, the government’s welfare policies must continue to supplement and complement incomes of those in the B40 and lower end of the M40.”

While concurring with Mustapa’s statement, Loh expressed hope that the government will do all it can to continue helping the rakyat.