Kenanga Research expects unemployment in 2022 to improve to 3.9% from its earlier projections of 4.6% in 2021.
Nonetheless, It said that it reiterates its cautiously optimistic outlook on the labour market for 2022, largely due to the persistent downside risks associated with the COVID-19 new variant, which may undermine growth recovery.
It said that the 2021 unemployment rate is expected to settle within our projection (4.6%; 2020: 4.5%) and the labour market is expected to continue to recover in the final month of 2021 and reach our average forecast figure of 4.6% for the whole year, in line with the broad reopening of the domestic economy underpinned by the progress of the COVID-19 vaccination campaign.
It is said that the momentum is expected to gather pace in 2022 as the economy continues to chart an expansion bolstered by various ongoing policy support and robust external demand.
