Expert warns of brain drain over wage gap in ICT industry

Woon Thai Hai, organising chair of Pikom’s research and publication committee.

PETALING JAYA: An expert today raised concerns over the wages of entry-level graduates in the ICT or information and communications technology industry, warning of a possible brain drain to countries with higher salaries if the matter is not addressed.

Woon Thai Hai of the National ICT Association of Malaysia (Pikom) said while the salary of entry-level graduates in the industry is satisfactory at about RM3,000, the gap between this and the salary of senior management personnel is quite wide.

Speaking at the launch of Pikom’s annual review of the ICT job market outlook in Malaysia here today, he said some disparity is expected, adding however that it should not be widening.

He warned that if entry-level graduates are not adequately compensated, this could result in a brain drain to countries such as Singapore and Australia.

He said students may even choose not to study computer science, which would affect the pool of new talent in the market.

“There may not be many parents who want to send their kids to study computer science,” he said, adding that there had been a drop in ICT graduates in recent years.

He suggested that companies provide increments for workers once they are no longer at the entry level, in terms of money, training and support.

Pikom chairman Ganesh Kumar Bangah agreed that there is a gap in wages, attributing this to what is taught in universities and the rapidly changing nature of advancements in technology.

He said skills and knowledge acquired at university may be obsolete upon graduation, which would require employers to upskill and retrain such graduates.

Nonetheless, 2019 is set to be an encouraging year for the ICT industry, according to Pikom’s annual report.

“With last year’s political upheaval and the significant changes across all industries, coupled with the global trade’s persistent uncertainties and the tech war, Pikom foresees a moderate improvement in 2019,” Ganesh said.

The report, in collaboration with JobStreet, said many factors had contributed to the general slowdown in the industry last year, including the decline in commodity prices and the ongoing US-China trade war.

During his presentation, Woon, who is also the organising chair of the research and publication committee, said salaries in the ICT industry grew at its slowest pace this decade.

The overall average monthly salary in 2018 was only 40% higher than that of the previous year, and significantly below the average annual growth rate of 6.7% over a nine-year period between 2009 and 2018.

“While demand for ICT jobs remains healthy, employers seem to be more discerning in their employment choices,” he added.

He also attributed the drop in growth of both salaries and job openings last year to the recalibration of the economy following the change of government, which he said had made employers more cautious.

However, Pikom expects an economic rebound in the second half of 2020, with the government focusing more on big data analytics, 5G and the Industrial Revolution 4.0.

In a press conference with reporters after the presentation, Ganesh noted the slow movement of new projects and initiatives by the Pakatan Harapan government in its first year.

“But we are starting to see changes there,” he said, adding that the progress of new initiatives would provide more jobs in the industry.

“We are hopeful that government spending will restart and further fuel the economy, and that the ICT industry will grow together with the growth economy,” he said.