PETALING JAYA: Financial assistance for youth to kick-start their careers should be considered in the upcoming Budget 2023 to address unemployment, says a youth group.

National Society of Skilled Workers secretary-general Mohammad Rizan Hassan said the government should shift its focus to helping the emerging labour force instead of only channelling money to companies through wage subsidies.

He said while the subsidy would be helpful for the companies to reduce their burden, young employees also need a financial boost, especially those from the rural areas.

“Youth, too, need financial support for them to look for jobs and kick-start their careers.

“A new worker would need to spend a lot, especially in terms of their mobility and lodging. So, it is important that the government can help by providing the necessary assistance,” he told The Star.

On Tuesday, Prime Minister Datuk Seri Anwar Ibrahim said although the national unemployment figures were low, the youth unemployment rate for those under 25 was at 10%.

Mohammad Rizan also suggested the government to look into providing affordable rental housing nationwide for youth to encourage them to get a job.

“Aside from main cities, the government also needs to introduce micro-housing with affordable rental in all areas where the demand for workers is high.

“This will encourage the young workers to get a job,” he said.

He said a significant portion of the younger labour force preferred flexibility when it came to securing a job, leading to gig economy becoming more popular among them.

“Yes, there are youth who prefer to work as e-hailing drivers, do food deliveries, freelancers and other jobs that don’t require you to be attached with a specific company.

“However, they also realise that it won’t be sustainable for their future as they need retirement security. The government should also find ways to help youth in the gig economy,” he said.

National Human Resources Association (Pusma) president Zarina Ismail said more young people were prioritising freelancing due to unattractive salary packages offered by some companies.

“I know some youth who say they could earn up to RM3,500 per month by doing food delivery and questioned why should they entered the formal sector,” she said.

She suggested the government to start taking technical and vocational education and training (TVET) seriously to keep the young labour force in the formal sectors.

“Industries nowadays need high-skilled workers and by providing more grants for employers to upskill themselves through TVET, we will not face the issue of high youth unemployment.

“It will also help in addressing our dependency on foreign labour,” she said.

Youth activist Varsha Ajmera said if the high unemployment rate among the youth were not addressed, the country would experience further economic difficulties as it would affect consumer spending.

She added that Malaysia would have its human capital wasted and drive income inequality.

“It causes financial hardship, affects consumer spending, which is a key driver for the country’s economy, which then may result in inflation and recession. Human capital is wasted .

“When unemployment rates are high, we find that the marginal impact of income inequality is negative and significant,” said Varsha, who is also the former World Youth Foundation chief operating officer.

She also called for the government to look into long term plans and not only make cosmetic changes, starting from the education system itself.

“Overall, they should have a long-term sustainable effort rather than piecemeal strategies.

“We need to bring our education system on par with international standards,” she said.