Logistics and transport as the catalyst for economic development in Sabah

Our prime minister had made a very important statement regarding the East Coat Rail Link  (ECLR) for the East Coast states in Peninsula Malaysia in that it is a mean to close the gap between the varying development progress between the regions in the country especially between the East and West coast of peninsula Malaysia. So transportation is a critical factor in ensuring development of economic activities. With the implementation of the ECLR the gross domestic product (GDP) of the three east coast states is projected to grow by 1.5%. It will change the economic landscape of Kelantan, Terengganu and Pahang turning them into trade hubs, tourism destinations and new investment focus. It is a game changer that would spur higher growth.

By the same token, Sabah has a mega transport project that would be a game changer for Sabah and that is the Pan Borneo Highway to improve connectivities and spur development along the highways in the hope that it would be a catalyst for economic  activities, especially in manufacturing to take place.

In addition, the construction of the East Coast Rail Line (ECRL) for Sabah's East Coast can change the landscape of Sabah's east coast with the opening up of the district’s economy through rail access.

The same goes for the construction of rail lines in terms of commuter rail service to serve Kota Kinabalu and its suburban districts. A good linkage between Sapangar Bay Port (SBP) and the Kota Kinabalu Industrial Park (KKIP) is an absolute must if we want to see SBP as a new kid on the block in transhipment makes the impact that it had been hoped for. It is however well noted that a tunnel had been dug to provide for a shorter access to the KKIP to make way for faster and cheaper cargo transportation from Sapangar Port to the KKIP. KKIP is an important landside depot as it helps the port to quickly clear space in the port area thereby avoiding congestion of operation within the port.

The creation of a superior port must be supported by a host of related industries and activities and that one cannot wait for the other to exist before it is started. It has to be in tandem so that it would create the lure for investors yearn for bringing in the much needed activities to generate its industries.

Planning is a total and holistic approach to ensure that critical industries and sectors are served.  Investors will look at what is the current status of the economy of Sabah, re the concrete plans that had been approved to make the plan happen. Only then will investor be happy to commit investing in Sabah.

Take for example the palm oil industry. It is a huge business where Sabah produces about 40% of the nation's output but Sabah cannot take advantage of this in developing down streaming of activities of this industry. Since there is no manufacturing activities that will be generated, our logistics industry will also suffer with no land transportation activities to be seen and thereby no port container operation taking place. We are missing on the spectrum of pushing our economic activities to a greater height by not down streaming the palm oil industry.

We use to say that in the transport and logistics sector planning must precede the demand and therefore the supply of the infrastructure must be made available first so that it will generate traffic. There are many a time that activities will only happen when they see that there are facilities available for them to plan and suit their needs and activities.

So in general it is a question of the hen or the egg first. Government would have to be strong in committing to creating an environment that will create a conducive window for development. Such planning frame does not happen here as the budgetary constraints will always be for the obvious necessities but not those that is a future necessity which if done now could make for great savings in cost rather than wait for the time when it is to be implemented at an exhorbitant cost but has to be implemented as it has become a critical need.

Railway is expensive. That is why rail planning must have a parallel development strategy. It has to be measured by the performance of other competitive modes such as road and air. In our case, it therefore requires not only careful planning but also has to be accompanied by long-term strategic policies that will reverse the domination of the road transport sector. We have definitely been road- or highway-biased, preferring to invest heavily on highways and focus more on cars as a mode of transport.

It is therefore quite refreshing when a leader, in reference to our Prime Minister on the development of the East Coast Rail Line, touches on the importance of rail and how it can play a significant role in the future transport sector. A rail system, for its rigidity and fixed route, needs to have other supporting infrastructure that will make it work. With the right support and connectivity, it can, after all, be made to be more efficient than road transport.

Since it can also accommodate more traffic (freight and passengers), a well-planned railway, of an appropriate design, speed and technology, can outperform road mode in terms of better travel time and capacity. It is, after all, a cheaper mode of transport and less polluted.

Planners must incorporate the need to connect the existing network with a new rail network, so that connectivity can be enhanced and the future network expanded.

This is strategic planning for the transport and logistics sector, a statement that  we often find missing and definitely lacking in many transport project planning documents or blue prints.

We are also hoping that projects developed and harnessed under the Sabah Development Corridor (SDC) would all be successful so that it will add to the economic well being of the state. Logistics being one of the pillar in transforming Sabah’s economy in the context of the SDC would provide for a seamless impetus and kickstarts to many projects that is being undertaken privately. Only when state development plans like the SDC is well in placed woul eventually spur investments and development coming into the state.

Graduate Unemployment in Malaysia

"The top industry that leads the job market is in the Manufacturing & Logistics sector"

Every year over 200,000 students graduates from institutions of higher learning. Being a university graduate no longer guarantee a job. As the number of graduates climb each year, students are facing tough competition amidst a shaky economy. This article seeks to state the facts why fresh graduates are unemployed in Malaysia, and what can be done to increase employability.

Unemployment issue in Malaysia

Research has it that one of the factors that contribute to the unemployment problem among the Malaysian graduates is the quality of the graduates.

There are employers in the industry, who gave negative comments on the graduates and mentioned that the graduates do not have suitable skills and qualifications to meet the needs of the industry. The graduates are also weak in respect of employability skills and lack of good quality work performance.

A study conducted by Central Bank of Malaysia in 2002 also found that the Malaysian graduates are less skilled as compared to the international graduates. The skills include technical skills, problem-solving skills and communication skills, especially in English language. Research also found that several primary weaknesses of Malaysian graduates are in the areas of management, problem-solving, communication, leadership, creativity, critical thinking, proactive, self-confidence and interaction skills.

These are obstacles for the graduates in finding jobs. It was also stated the several factors also contributed to the unemployment problem among the graduates such as the lack of the interactions between educational institutions and the industry resulting in the lack of training to prepare graduates for the real world.

Industries has also reported that the reason for job vacancies is because of lack of candidates who are qualified for the posts. 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 skills in almost all of the working fields. Consequently, this is the reason that makes a candidate not selected for failing to meet the requirements of the industry.

A study conducted in 2008 found that graduates of Higher Educational Institutions in Malaysia has minimum preparation in facing the challenges posed by globalization and k-economy phenomena. This situation may result in the hiring of foreign workers.

A good academic achievement therefore is no longer a guarantee for our graduates to land a job. Since there is a big gap between the quality levels of the Malaysian graduates with that expected of an international standard, this provides us with a big challenge in order to ensure that our country has skilled, versatile and marketable graduates.

Human capital theory state that human capital that has a high knowledge and skills contribute to the increase of the country’s economic productivity. It 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.

The Current Scenario

Finding shows that unemployment in Malaysia is concentrated among the youth. About 200,000 students graduate annually where one in four fresh graduates remain unemployed six months after graduation. Six out of 10 of those unemployed are below the age of 24.

Among fresh graduates with tertiary education 31.4% degree holders are unemployed, of which 43.4% come from the arts and social science. The Field of studies breakdown are, Arts & Social Science 43.4%, Technical 24.5%, Science 20.2%, ICT 8.1% and Education 3.9%.

The majority of unemployed fresh graduates are from public universities (IPTA) at 51%, 34% from private Universities (IPTS), 13% from Polytechnics, 2% from Community Colleges. Based on Job Street Survey, 64% of employers said they did not care whether graduates were from foreign, private or public universities.

As per JobStreet survey, employers are saying that 68% of fresh graduates were asking for unrealistic salary and benefits, with 30% expecting a starting salary of RM6,500. Top reasons for fresh graduates unemployment are poor attitude or character 59%, poor command of English 64%, and poor communication skills 60%. Employers also felt graduates lacked adaptability, multitasking skills, decision making skills and problem solving skills.

Job postings on JobStreet only fell 1% in 2015.  88% of employers stated that they are maintaining or increasing hiring in 2016.

The top 5 industries leading the job market are manufacturing and logistics, banking & financial services, construction, ICT, and wholesale & retail.

The top three specialisations that is in high demand are sales & marketing, accounting and engineering.

The technology related jobs that are trending are cloud related jobs, mobile developers, SEO/SEM specialists, UI/UX designers and digital/social media marketing specialists.

How to increase employability

·         Improve proficiency in english. The majority of companies conduct their business in english, so it is critical to be proficient. They must practise both written and oral english, surround themselves with the english language and to keep improving and learning. It is a marathon not a sprint.

·         Gain work experience. This allows one to observe how skills, ideas and knowledge are applied in the working world. This can be done by taking up an internship during semester breaks, participate in job shadowing programmes and to take part in extracurricular activities.

·         Develop skill sets to be more well-rounded. Straight A's, 1st class honours or a CGPA of 4.0 does not guarantee employment.Hard skills in computer literacy, numeracy, writing skills and language skills need to be learned and developed. Soft skills such as communication, problem solving, creativity & innovation, time management and teamwork are also crucial.

·         Be responsible. One in three employers stated that candidates often fail to turn up for the interview. One must prepare well for the interview, must be appropriately dressed and most importantly to show up for the interview.

What it meant is that candidates should develop transferable skills, not just specialist skill, to enable them to do other job roles.