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Why Underpaid Fresh Graduates Are The Norm, And What You Can Do About It.

By Dhiva Karthik, Head of Executive Search

Imagine your RM15k salary a month being slashed to RM1.5k a month. Can you do it? Would you be able to live with it?

According to recent studies, it is not uncommon for fresh graduates to be underpaid. This is especially true for those who are just starting out in their careers and lack experience in their respective fields.

One of the main reasons why fresh graduates are often underpaid is because they lack negotiating power. Many graduates are simply happy to have landed a job, and they may not feel comfortable negotiating their salary or benefits. Additionally, some employers take advantage of the fact that new graduates are less likely to negotiate their salary, and offer them a lower wage than what they would offer to a more experienced candidate.

Another reason why fresh graduates may be underpaid is because they lack the experience and skills that employers are looking for. While a degree may be enough to get a foot in the door, it is often not enough to command a higher salary. Employers may be looking for candidates with specific skills or experience that fresh graduates may not yet possess.

While it can be disheartening for fresh graduates to realize that they may be underpaid, there are steps that employers can take to address this issue.

  1. Conduct market research: Employers should research the current market rates for entry-level positions in their industry and location. This will help them understand what the going rate is for fresh graduates and ensure that their compensation packages are competitive.
  2. Develop transparent salary structures: Employers should develop clear and transparent salary structures that outline the pay scale for each role within the organization. This will ensure that all employees, including fresh graduates, are paid fairly and consistently.
  3. Offer benefits and perks: Employers can offer additional benefits and perks to fresh graduates to make up for lower starting salaries. This could include things like flexible working hours, professional development opportunities, or health and wellness benefits.
  4. Provide career growth opportunities: Employers should offer clear pathways for career growth and advancement within the organization. This will show fresh graduates that there is room for them to grow and develop within the company, which can be a valuable incentive.
  5. Seek feedback: Employers should regularly seek feedback from their employees, including fresh graduates, to ensure that they are happy with their compensation packages and feel valued within the organization. This can help employers identify areas for improvement and make changes as needed.

Overall, employers can stop underpaying fresh graduates by being transparent about their salary structures, offering competitive compensation packages and benefits, providing opportunities for career growth, and seeking feedback from their employees

Fresh graduates being underpaid is a common issue, but it is not insurmountable. By understanding the reasons why, they may be underpaid and taking steps to address the issue, graduates can improve their chances of earning a fair wage and building a successful career.

At CXL we understand that just like people, organisations have different personalities, cultures and structures. Thus, we deep dive to understand your organisation inside out for an ideal talent fit with the right skill set, experience and values. That way your new employee will take your organisation to the next level.



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