Malaysia’s labour market continued on an improving trend as unemployment rate maintained at post-pandemic low of 3.3% in Dec-23. Overall 2023, the jobless rate averaged at 3.4%. Labour force and employment improved further by +2.0% (2022: +2.6%) and +2.4% respectively.
Unemployed persons declined by -8.1% while outside labour force fell by -0.5%. The unemployed persons dropped further by -0.2%mom to 568K in Dec-23, approximately 49K higher than average jobless persons 519K in 2019. For youth aged 15~24, the unemployment rate averaged at pandemic and post-pandemic low of 10.9% in 2023.
By employment type, employee which made up about 75.4% of the employment increased steadily by +1.4%yoy while employer and own-account-worker increased by +5.3%yoy and +6.5%yoy respectively in 2023. The strengthening and healthier job market in our view will further reinforce consumer consumption and support overall GDP growth for 2024.
In view of the latest report from DOSM, MIDF says it expects the The labour market to strengthen further in 2024, backed by encouraging momentum in the domestic economy and recovery in external trade.
Malaysia’s average unemployment rate is expected to maintain at 3.4% in 2024. The return of non-citizens workers is expected to boost overall employment and reduce the jobless rate. As of 3QCY23, non-citizens’ employment is almost -0.8% lower than pre-pandemic levels.
The downside risks to Malaysia’s labour market among others is lower-than-expected external trade recovery and nosedived of global commodity prices.
