More than one-third of graduates in these mismatched jobs will remain in such a predicament over some time, the KRI study “Shifting tides: Charting career progression of Malaysia’s skilled talents” found.

“Since starting your career on the wrong foot could have enduring effects on your future career trajectory, ‘last-mile’ active labour market initiatives are important to facilitate the education-to-work transition,” the report said.

Lead author Hawati Abdul Hamid said this could ultimately overcome the underutilisation of skilled talents needed to drive the nation’s development.

The report looked at surveys carried out by KRI and the higher education ministry to track graduate career progression.

It found while there has been some progress in getting more graduates into skilled jobs, issues with low wages persisted.

The report said the number of underpaid graduates was decreasing but a huge chunk of them still faced problems with underemployment, no matter how long they had been working.

Underemployment is when a person is in a job inadequate with his or her training.

KRI said to fix this, there must be efforts to help graduates find jobs that better matched their skills.

It said schools, businesses and the government need to work together better to make sure there are enough good jobs for graduates and that they get paid fairly.

The study found that over the past 10 years, about 60% of graduates managed to land high-skilled jobs, matching their academic abilities.

Starting pay has also improved, the research found. It said in 2010, more than 63% of degree holders were earning less than RM2,000 when they started working, but by 2022, this dropped to about 43%.

For diploma holders, the percentage of those earning less than RM2,000 decreased from almost 94% in 2010 to about 78% in 2022.