Malaysia's employment numbers increased from July to August 2020, but dropped y-o-y

Malaysia recorded a marginal increase in employment in August 2020, a 0.5% growth from the month before. As at end-August, the number of employed persons in the country stood at 15.15mn (July 2020: 15.07mn). At the same time, the country's unemployment rate for August remained at 4.7%, while labour force participation improved with 76,600 more persons recorded.

In line with this, the latest Key Statistics of Labour Force in Malaysia, released by the Department of Statistics, showed that since June 2020, the monthly increase of employed persons ranged from 80,000 to 102,000. That said, as at the end of August this year, the total employment number remained 0.2% lower as compared to August 2019 (15.19mn).

Employment by sectors and categories

In sector-specific data, the month of August 2020 saw an increase in employment in the services sector, largely in wholesale and retail trade, accommodation and food and beverages, as well as information and communication activities.

Meanwhile, the manufacturing sector, which is typically the second largest contributor to the economy, recorded a decrease in employment in the month. According to the report, this was a result of a decline in the Industrial Production Index for Manufacturing, which led to a decline in the number of employed persons in the sector.

In terms of categories, i.e. employees and own-account workers, the number of employed persons in the employee category saw an increase of 72,600 month-on-month (m-o-m) from July 2020, to 11.72mn August 2020. Likewise, own-account workers accounted for 2.42mn persons, recording an increase for the first time since April 2020 (July 2020: 2.38mn persons).

Further, the share of own-account workers grew by 0.1percentage points (pp) as compared to the previous month, registering at 15.9%(July 2020: 15.8%).

As noted by the report, the Special PRIHATIN Grant of RM3,000 which was introduced in May 2020 has shown a positive outcome in assisting these groups to sustain and return to the labour market.

Unemployment rate remained at 4.7%

The unemployment rate in August 2020 continued to stand at 4.7%. That said, the number of unemployed persons still saw a marginal decrease m-o-m, from 745,100 in July 2020, to 741,600 in August. However, when compared year-on-year (y-o-y), the unemployment rate was 1.4pp higher than the same time last year (August 2019: 3.3%), with 221,400 more unemployed persons this year (August 2019: 520,200).

Taking a closer look at the unemployment numbers, the report noted that more than 80% who were unemployed in August this year were actively unemployed. Of this group, 49.2% were unemployed for less than three months, versus 49.6% in July 2020.

Meanwhile, 9.4% (58,000) of this group were in long-term unemployment for more than a year.  

On the other hand, the number of inactively unemployed, i.e. those who believed there were no jobs available during the month, grew 0.3pp from July to August (124,900 in July vs 126,500 in August).

Labour force participation rate improved 0.3pp

In the same period, the number of labour force in Malaysia increased by 76,600 persons to record 15.90mn persons, as compared to July 2020. On a y-o-y comparison, the number of labour force rose to 189,100 (1.2%) as compared to August 2019 (15.71mn).

During the month, the labour force participation rate (LFPR) improved 0.3pp to 68.4% (July 2020: 68.1%). However, this statistic declined by 0.2pp from the same month in the previous year (August 2019: 68.6%).

Photo / DOSM

Human Resources Online is on Telegram! Follow us @humanresourcesonline or click here for all the latest weekly HR and manpower news from around the region.