PUTRAJAYA: Malaysia’s labour market gained momentum in 2024, recording its strongest post-pandemic performance yet, with key indicators showing improvement and stability expected to persist into 2025, the Statistics Malaysia Department, said on Monday (June 30).

According to the Statistics Malaysia Department’s Annual Statistics of the Labour Force, Malaysia 2024, the unemployment rate fell to 3.2%, dipping below the pre-pandemic level of 3.3% recorded in 2019.

The number of unemployed persons also dropped to 534,100, driven largely by a decline in unemployment among youths aged 15 to 24.

“Concurrently, the labour force increased by 3.3% to 16.90 million persons compared to 16.37 million persons in the previous year. The labour force participation rate (LFPR) also rose to a new record high of 70.6 % from 70 % in 2023,” the Statistics Malaysia Department said in a statement.

“The number of employed persons also saw positive annual growth, rising by 3.5% to 16.37 million from 15.81 million in 2023,” it said.

“Accordingly, the employment-to-population ratio, which indicates the ability of an economy to create employment, also increased by 0.7 percentage points to 68.4% from 67.7% in 2023,” it said.

The Statistics Malaysia Department said in terms of employment status, 78.5% of employed persons were classified as employees’ category while the number of own-account workers category went up to 2.52 million persons, accounting for 15.4% of total employment.

It said most employed persons remained in semi-skilled occupations, representing 56.5% of total employment or approximately 9.26 million persons, followed by skilled occupations (4.94 million persons) and low-skilled occupations category (2.17 million persons).

From a sectoral perspective, employment remained dominant in the services sector which continued its upward trend and comprised 65.6% of the total employment followed by the manufacturing sector at 16.3% and agriculture sector at 9%.

Additionally, the construction sector accounted for 8.5% of total employment, while the mining and quarrying sector recorded the smallest share at 0.5%.

The department said the underemployment situation improved in 2024, with the number of employed persons working less than 30 hours a week, due to job nature or insufficient work, falling by 6.1% to 212,500 from 226,300 in 2023. Consequently, the underemployment rate declined to 1.3% from 1.4% in the previous year.

Youth unemployment fell to 10.3%, with the number of unemployed youths down 4.1% to 284,700 while unemployment among adults aged 25 to 64 also improved slightly, falling to 1.8%.

At the state level, the Statistics Malaysia Department said Wilayah Persekutuan Putrajaya recorded the lowest unemployment rate at 1.1%, followed by Melaka (1.6%), Penang and Pahang, each recorded 2%.

Meanwhile, the highest LFPR was also registered in Putrajaya at 78.7% followed by Selangor (77.9%), WP Kuala Lumpur (75.4%) and Pulau Pinang (72%).

The Statistics Malaysia Department said in terms of female participation, five states exceeded the national level of 56.5% namely WP Putrajaya at 79.4%), Selangor (70.3%), WP Kuala Lumpur (66.6%), Melaka (58.4%) and Pulau Pinang (57.6%).

It said despite the positive trends, 7.02 million persons remained outside the labour force mainly due to housework or family responsibilities with a share of 43.1%, followed by those in the schooling or training category comprising 41.3%.

Looking ahead, DOSM said the country’s labour market will remain resilient in 2025 supported by stable economic growth, Malaysia’s Asean Chairmanship and initiatives like the Asean Villages Network, which are expected to spur rural development and workforce upskilling. – Bernama