The Department of Statistics released the labour report indicating a robust employment market in Malaysia with unemployment rate remaining at a mere 3.3% in Dec 2023 for the second month amid steady jobs growth. Jobs increases were registered across sectors ex-agriculture however the big concern in the data was youth unemployment rate which had stayed sticky with over 10% while informal jobs hits 3 million for the first time.
Overall, unemployment rate was stable at 3.3% in Dec 2023, in line with steady employment growth that outpaced labour force growth. The number of unemployed declined -5.3% YoY and -0.2% MoM. According to DOSM, jobs growth in Dec 2023 was manly driven by the services sector such as Information & Communication, Food & Beverage and Transportation & Storage, plus hirings in the Manufacturing, Construction and Mining & Quarrying sectors, but employment in the Agriculture sector fell.
Based on the latest monthly manufacturing statistics in Dec 2023,growth of manufacturing employment moderated amid pickup in wages & salaries. Notwithstanding the return of monthly jobless rate to pre-pandemic level, monthly workers retrenchments have been rising YoY since Feb 2023 up to the latest data as of Dec 2023 to result in +45.6% increase in 2023 to 49,982.
Sticky youth unemployment rate as informal jobs hit 3 million mark
Youth unemployment remained at 10.6% in Dec 2023 (Nov 2023: 10.6%) and it has been “stuck” in the 10.6%-10.8% range since Aug 2023, thus still above the pre-pandemic low of 9.9% in Dec 2019.
Informal jobs/workers i.e. “Own Account Workers (i.e. daily income earners working as petty traders, hawkers, food stalls operators as well as smallholders plus gig workers) has been rising since Jan 2021 (2.39m) and reached a new high of 3.00m in Dec 2023 (Nov 2023: 2.994m) as growth in informal jobs surpassed total employment growth.
Maybank IB expects stable unemployment rate of 3.4% in 2024 and after moderating to 3.4% last year from 3.8% in 2022, the house expects unemployment rate to be stable at 3.4% in 2024.
