PETALING JAYA: Malaysia’s labour market is expected to remain stable through 2024, underpinned by the expansion of the country’s economy.
According to several brokerages, the unemployment rate in the country will likely average at 3.3% this year. Last year, the jobless rate was at 3.4%.
Hong Leong Investment Bank (HLIB) Research said in its report yesterday that the “stable” outlook for the labour market this year reflected by the continued growth in employment in recent months amid the steady expansion in gross domestic product or GDP growth.
“Consequently, we maintain our expectation for unemployment rate to remain at 3.3% throughout 2024,” it said.
“Stable labour market, positive wage growth and income supportive measures such as the Employees Provident Fund (EPF) Account 3 withdrawal campaign and salary increment for civil servants in December are anticipated to provide further support to private consumption,” it added. HLIB Research noted that as of June 24, EPF members have withdrawn RM7.81bil, following the account restructuring while civil servants could receive up to 42.7% pay hike, with full announcement to be made in Budget 2025.
Malaysia’s unemployment rate remained unchanged at 3.3% in June, the same as in the preceding month, the Statistics Department revealed last Friday.
The positive momentum was supported by improvements in the manufacturing sector and continued trade recovery.
With the latest data, Maybank Investment Bank (IB) Research said after moderating to 3.4% last year from 3.8% in 2022, it expected full-year unemployment rate to average marginally lower at 3.3% in 2024.
“As job market settles into a ‘steady state’ from the perspectives of unemployment rate as well as employment and labour force growth, the key developments are more on workers’ income as certain segments of workforce will enjoy higher wages and salaries,” it said, citing civil service pay rise of 15% to 42.7% in December and the prospect of minimum wage review in 2025.Similarly, BIMB Securities Research attributed the stable labour market outlook in 2024 to economic growth, job creation, and rising labour participation.
“The boost in Malaysia’s tourism sector has further enhanced the economic outlook and supported labour market expansion. The ‘Visit Malaysia 2026’ initiative, aiming to attract more international tourists, has bolstered tourism-related industries, contributing to business growth and job creation,” it said.
“While the unemployment rate is likely to stay at 3.3%, signalling near full employment, geopolitical tensions and slow trade recovery could pose risks to stability,” it added. TA Research said projections suggested a potential decrease in the unemployment rate to 3.2% by year-end.
“Malaysia’s economy is showing steady growth, driven by strong domestic and export activities, an improved job market, and positive trends in the agriculture and construction sectors.
“The uptick in business activities is expected to attract more investment and trade, further enhancing job creation and positively impacting the labour market,” it said.
