What is the Job Demand for Electrical & Electronic Engineers in Malaysia?
What is the Job Demand for Electrical & Electronic Engineers in Malaysia?
Find Out About the Talent Demand in Malaysia’s Electrical and Electronics (E&E)
A new World Semiconductor Trade Statistics (WSTS) report has also forecast that annual global sales would increase 13.1% in 2024, after falling 9.4% in 2023.WSTS projected worldwide semiconductor sales to reach US$520bil in 2023 (down from the 2022 sales total of US$574.1bil) and hit US$588.4bil in 2024.
The E&E industry is one of the major industries that contributed to Malaysia’s exports of manufactured goods, jobs creations as well as income growth. As outlined in the New Industrial Master Plan (NIMP) 2030, the E&E sector was identified as one of the high-growth, high-value industries (HGHV). In addition, Malaysia is ranked as the seventh largest semiconductor exporter, with a global market share of seven per cent and Malaysia is now supplying approximately 13 per cent of the demand for packaging and testing, along with certain levels of wafer fabrication, such as 200nm.
With an 18% growth in 2021 and an impressive 30% growth in 2022, the E&E segment has been expanding significantly in recent years as the country has successfully fostered an active ecosystem for E&E manufacturing, attracting substantial investments. In 2021, the E&E industry recorded investments amounting to RM148bil, and from January to September 2022, 83 E&E projects with investments were approved, accumulating its total value to RM22.5bil.
Notably, E&E products contributed 39.8% (RM57.41bil) of total exports during this period, and according to the 12th Malaysia Plan, the E&E industry is expected to contribute a total of RM120bil to the GDP by 2025. A vital component of the E&E sector is the semiconductor industry, which in itself is projected to reach US$1 trillion (RM4.5 trillion) in global revenue in 2023.
This industry plays a key role in enabling various technological applications, such as IoT, medical devices, industrial automation, transportation systems, aerospace technology, and renewable energy solutions, among others.
In the 1970s, In the 1970s, the ‘Eight Samurai’ (National Semiconductor, Intel, Advanced Micro Devices (AMD), OSRAM, Hewlett Packard, Bosch, Hitachi and Clarion) began operations at the Bayan Lepas Industrial Park in Penang. Since then, some 300 multinational corporations (MNCs) have started offices in Malaysia, creating an electronics and electrical (E&E) hub that has been likened to the Silicon Valley in the United States.
The Malaysian Electronics and Electrical sector (E&E) is an important contributor to the economy. In 2019 alone, it accounted for 6 percent of Malaysia’s gross national income (GNI), 575,000 jobs — representing more than 40% of total manufacturing labour — and 41 percent of Malaysia’s total exports. The electrical and electronics (E&E) industry is the largest single contributor to the manufacturing sector, accounting for 26.1% of total manufacturing output (Source: EPU, Pemandu).
Malaysia’s world-class electronics industry is the top sectorial employer and exporter within the manufacturing sector. The E&E industry is also Malaysia’s most liberalised sector. The electrical and electronics (E&E) industry produces and sells electronic equipment for industries and electronics products for consumers such as televisions, mobile devices and printed circuit boards. The industry includes telecommunications, electronic components, appliances, industrial electronics and consumer electronics. Electronics companies may produce electrical equipment, manufacture electrical components and sell items at retail to make their products available for consumers.
The development of high value and high growth industries in Malaysia will increase demand for skilled manpower, which then leads to better wages and compensation for Malaysian employees. Therefore, students wanting to pursue a career in engineering should consider taking up electrical & electronic engineering due to its immense contribution to Malaysia’s economy and future growth, long-standing history with lots of SME’s, large local companies (LLCs) and multinational corporations (MNCs) offering lots of job opportunities.
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Malaysian Electronics and Electrical sector (E&E) Industry Outlook & Job Demand
Chong Keat, Electrical & Electronic Engineering at Heriot-Watt University Malaysia
E&E industry employs about 700,000 people of whom 30 to 40 percent are engineers and managers. Meanwhile, foreign direct investments (FDIs) continue to grow while Design & Development (D&D) and business process operations/services have also grown significantly. Around 12,500 are skilled engineers, 3,500 are Masters graduates and 191 PhD holders. 7500 are involved in R&D.
According to Mida, among the high value E&E investments is from Texas Instruments Malaysia Sdn Bhd. The approved investments by Texas Instruments, that totalled RM7.4 billion, was in semiconductor devices and high-performance integrated analogue circuits.
In August 2023, it was reported that German semiconductor giant Infineon Technologies AG announced that it would invest up to €5 billion (RM24.9 billion) to expand its manufacturing facilities in Kulim, Kedah, over the next five years.
Mida also stated that a total 48.1 per cent of the recorded FDI in the country for the first half of this year consisted of new projects, reaffirming foreign investors’ confidence in Malaysia as a preferred investment destination. The approved investments in the manufacturing sector is expected to create a total of 26,759 potential job opportunities, out of which 10,892 (40.7 per cent) are high-impact jobs.
While Penang has the most E&E companies, there are also big players in Kedah, Selangor, Melaka, and Johor. Nearly 560,000 job opportunities have been created in the industry. According to SEMI, a global industry association representing the electronics manufacturing and design supply chain, Penang itself contributes approximately 8% of (Malaysia’s total 13%) the global back-end semiconductor output.
The state is one of the most significant microelectronics assembly, packaging, and testing hubs in the world. This has successfully positioned Malaysia in the global supply chain of electronic manufacturing services, outsourced semiconductor assembly and testing (OSAT) as well as in research, design, and development.
Malaysia’s move into Industry Revolution 4.0 as well as the Internet of Things (IoT) technology is made possible by the existence of its established (E&E) sector. In short, our rapid industrialisation and high ranking among the top group of trading nations globally were mainly contributed by this industry.
Malaysian Investment Development Authority (MIDA) – E&E Industry to Create Value Jobs
Jun Chung, Diploma in Electrical & Electronic Engineering at Asia Pacific University
MIDA has played a significant role in shaping Malaysia’s economic growth by attracting high-quality investments from multinational corporations (MNCs) that prioritise sustainable operations. These investments assume a pivotal role in the country’s economic development, boasting a substantial multiplier effect.
The electrical and electronics (E&E) industry, a formidable contributor, producing 13% of global back-end semiconductors and driving 40% of the nation’s export output. With ambitious targets set at RM120 billion by 2025 in GDP growth and RM495 billion in export earnings, the industry is a catalyst for Malaysia’s economic progress.
As a major hub in the semiconductor supply chain, Malaysia is well-positioned to capture further business. The semiconductor manufacturing activity, predominantly led by MNCs, holds immense significance across various applications, from the Internet of Things (IoT) to automotive, medical, industrial, transportation, aerospace, and energy.
Highlighting this growth, a total of 86 E&E projects valued at RM57.4 billion gained approval from January to September 2023. Foreign investments constituted a staggering 98% of the total, amounting to RM56.3 billion, with domestic investments comprising RM1.1 billion, fostering the creation of 15,343 job opportunities.
However, amidst this prosperity, the industry grapples with challenges such as talent shortages and high turnover rates. A 2022 survey by the Malaysia Semiconductor Industry Association (MSIA) revealed engineers at the forefront, constituting 65% of talent shortages.
As MNCs are advancing their operations, integrating manufacturing with research and development (R&D), product design and development (D&D), marketing, and distribution, Malaysia recognises the pivotal role of cultivating local talent. MIDA, with an eye on economic growth and innovation, is committed to building capacity and talent in integrated circuit (IC) design, engineering, and testing.
The New Industrial Master Plan (NIMP) 2030 stands a beacon, providing a clear direction, showcasing vast job opportunities in the manufacturing sector with higher-paying salaries. This strategic vision aims not only to attract but also to retain and cultivate talent within the fast-growing E&E industry. At its core, this vision seeks to create an abundance of high-value job opportunities, transforming Malaysia’s reliance on relatively low-cost foreign labour.
Collaboration with industry leaders, academic institutions, and training centres is integral to fostering a culture of innovation and excellence within the E&E industry. Embracing emerging technologies such as artificial intelligence, IoT, and advanced automation, Malaysia aims to address talent shortages, mitigate high turnover rates, and create a workforce capable of driving innovation and fuelling unprecedented growth.
The rise of MNCs establishing their operations in Malaysia serves as a testament to the nation’s attractiveness for investment. These MNCs including Dyson, choose to establish global in-house capability centres, remaining cost-competitive while delivering on their brand promises. Dyson, through the Dyson Malaysia Development Centre (MDC), exemplifies Malaysia’s commitment to talent development and retention. This centre not only offers a perfect opportunity for local talent to remain in their home countries but also gain global exposure.
Initiatives like the MDC reaffirm Malaysia’s dedication to talent development, empowering skilled professionals to contribute to cutting-edge innovations. This not only strengthens the local workforce but also elevates the nation’s competitiveness on the global stage, positioning Malaysia as a hub for innovation and sustainable economic growth.
E&E Talent shortage and mismatch in Malaysia
Eugene Ong, Electrical & Electronic Engineering at UCSI University
The talent shortage starts with university graduates. Nowadays, university students prefer software design to hardware design as they can see results faster. Unfortunately, there is a shortage of design talent around the world, let alone Malaysia.
There is also a mismatch of skills and competencies to industry needs. Malaysia has insufficient qualified and experienced technical workers to participate in higher-value activities, partly due to the low demand for masters and PhD holders.
This trend has discouraged university graduates to pursue postgraduate studies as most of the job requirements are not knowledge-intensive. In the long run, local engineers could not progress in their careers without specialist technical knowledge ad skills, hampering Malaysia’s ability to climb up the E&E value chain.
The Institution of Engineers Malaysia (IEM) president David Lai Kong Phooi said the engineer to population ratio for developed nations is 1:100. For Malaysia with a population of 32 million, the number of engineers should be 300,000.
Based on the Education Ministry’s statistics from 1997 to 2017, the average number of engineers produced per year by local institutions of higher learning – excluding graduates from foreign universities – is about 16,000. The cumulative total of all engineers produced from 1997 to 2017 is estimated to be about 341,109.
It may appear that the number of engineers produced are sufficient for Malaysia, but there are only 128,000 professional and graduate engineers registered with the Board of Engineers Malaysia (BEM).
While the number of varsity-trained engineers has been very encouraging in terms of meeting the country’s target, we’re still facing a shortage of engineers – perhaps not in terms of actual numbers, but in terms of employability, and retention of talents, within the engineering sector and with Malaysian companies, said Lai.
Based on Talent Corp’s Critical Occupation List, he said the highest demand for engineers are in the civil, mechanical, electrical, and chemical disciplines.
Lai said there are many reasons why engineers turn to other jobs. For some, it could be a lack of interest in the field or for career advancement.
“The entry level remuneration of engineers is among the highest compared to graduates from other fields.
It’s easy for engineers to switch careers at a later stage of their careers because they’re very analytical and easy to train. If they want to go into consultancy, planning, finance, or investment, they can pick it up with some training. But the reverse is not true. Non-engineers will find it hard to switch to this profession.
English is an Important Skillset for E&E Graduates
Soft skills, he said, is very important especially in an MNC.
“Expect daily meetings to discuss projects with your counterparts from countries like the US. If you cannot express yourself, how are they going to understand you? You’ll slow the meeting down and waste everyone’s time,” he said, adding that all the literature, and instructions on technology, are in English.
Those who are weak in the language will take a longer time to read. This results in lower productivity.
“You can’t keep checking the dictionary or asking your colleagues.”
Malaysia E&E Industry Outlook
Ong Richard, Diploma in Electrical & Electronic Engineering at KDU University College Penang
Malaysia’s exports, which dropped much lower than anticipated in December 2023, is expected to get a boost from an anticipated upturn in the global technology cycle in 2024. Along with other improving global factors, this is expected to bolster the country’s export numbers this year, according to economists.
December’s 10% year-on-year decline — double the Bloomberg consensus forecast of a 5% fall — pulled trade surplus down to RM11.8 billion, the lowest recorded since May 2020.
Overall exports for 2023 fell 8%, the biggest contraction since 2009, to RM1.43 trillion, though it is the third year in a row that Malaysian exports had surpassed the RM1 trillion mark.
In 2021, the E&E industry recorded investments worth RM148 billion, of which RM146.3 billion (98.8%) was from Foreign Direct Investment (FDI) while RM1.7 billion (1.1%) came from domestic investors. The approved investments are expected to create a total of 28,362 job opportunities in the industry.
From January to September 2022, a total of 83 E&E projects with investments of RM22.5 billion were approved, of which 31 were new projects with investments of RM2.0 billion, and 52 were expansion/diversification projects with investments worth RM20.5 billion. These projects are expected to generate more than 26,668 new jobs, including highly-skilled positions such as managerial roles, engineers, and technicians. Foreign entities accounted for the bulk of the total investments at RM21.3 billion (94.7%) while domestic investments amounted to RM1.2 billion (5.3%).
For the given period above, E&E products contributed 39.8% or RM57.41 billion towards Malaysia’s total exports, which amounted to RM144.31 billion. Under the Twelfth Malaysia Plan (12MP), the E&E industry is targeted to contribute RM120 billion to Malaysia’s GDP in 2025, compared to RM86.1 billion in 2020. (MIDA).
In recent years, multinational corporations have been upgrading their semiconductor operations by establishing integrated manufacturing centres that can combine manufacturing processes with those of research and development, product design and development, as well as marketing, and distribution.
This shows that the country is striving to establish a robust and well-developed manufacturing sector within the country by getting the necessary industrial infrastructure to support its growth, which will in turn attract both local and international businesses. As the global economic landscape evolves, developers in the country must adapt to develop more innovative industrial parks and facilities that can effectively cater to the needs of modern manufacturing companies.
