Q1 2023 labour roundup in Malaysia: Data points & initiatives that helped reduce unemployment

Looking ahead, the HR Ministry affirmed, the government will continue to focus on reducing the country's unemployment rate and improving the skills of workers in the country.

According to the Ministry of Human Resources (KSM), the number of unemployed persons in Malaysia continued to decrease in Q1 2023, reaching 3.5% (equivalent to 588,700 persons), down from 3.6% (roughly 599,600 persons) in Q4 2022.

The interstate unemployment rate also decreased, which paralleled the decrease in the national unemployment rate. Zooming into individual areas, Putrajaya recorded the lowest unemployment rate of 0.8% in Q1 2023, followed by Perlis (2.1%), Penang (2.3%), and Negeri Sembilan (2.5%). 

Meanwhile, according to the Department of Statistics, in earlier coverage by HRO, labour productivity in the country, when measured as value added per employment, grew 2.4% year-on-year (y-o-y) in Q1 2023, as total employment in the country increased by 16.1mn persons (+3.1%).

By level, labour productivity by value added per employment stood at RM23,712 (Q4 2022: RM 24,966).

It was further revealed:

• When measured as value added per hour worked, labour productivity in the country saw a 2.1% y-o-y increase in Q1 this year, with total hours worked up 3.5%, recording 9.2bn hours. In Q4 2022, these figures stood at 2.1% and 5% respectively, also recording 9.2bn hours.
• The economy expanded 5.6% in Q3, following a growth of 7.1% in Q4 2022. In terms of level, labour productivity by value added per hour worked was RM41,200 (Q4 2022: RM43,200 per hour).

Full updates on labour productivity in Q1 here.

As attested by KSM, the improvement in the figures can be attributed to the "strategic cooperation between various ministries and government agencies"; as well as initiatives implemented by KSM through the Social Security Organisation (SOCSO, or PERKESO), Talentcorp, HRD Corp, and the Skills Development Department. 

The Ministry highlighted the following key initiatives which have played a part:

• SOCSO's daily and weekly interview programmes in all State SOCSO offices, along with its large-scale Employment Carnival. The agency aims to run a total of 4,130 programmes in 2023, and as of April 2023, a total of 1,127 have been implemented with 5,121 job seekers successfully filling job vacancies.
• Initiatives implemented through the National TVET Council (MTVET). For instance, the government has signed a memorandum of agreement with government-linked companies and private companies that cover training areas to overcome skills mismatch and unemployment issues among TVET students.
• Next, through TalentCorp, KSM also successfully implemented the Young Employable Students Programme, in which a total of 2,407 participants successfully followed the programme until April 2023. Additionally through TalentCorp, KSM also ran the new Malaysia@Heart (MyHeart) programme to encourage Malaysians abroad who have high expertise to return home.
• KSM established a Placement Center with HRD Corp through an online portal which acts as a platform to match employees with job opportunities available by employers.
• HRD Corp also implemented a Digital Skills Training Programme for Vulnerable Groups, with a total of 5,465 attending the training.

Looking ahead, the government will continue to focus on reducing the country's unemployment rate and improving the skills of workers in the country, KSM stated. Under Budget 2023, KSM remains mandated to implement the Active Labour Market Programme initiative that was launched on 1 May, namely:

• An employment transition programme for TVET apprentices and graduates, or TVET Careers which provides an incentive payment of RM600 per month for a period of three months to employers who employ TVET graduates;
• The Gig Riders Informal Worker Career Building Programme, which provides an allowance of RM300 per month for a period of three months to gig workers who are actively undergoing skills training to get stable employment in the formal sector; 
• The extension of targeted employment incentives through the Career Empowerment Programme for target groups of youth who have been unemployed for a long time, and vulnerable groups such as indigenous people, women, people with disabilities, those in poverty, individuals on parole, ex-convicts, and more. Employers who successfully hire new employees under this category are eligible to receive up to RM1,800 per individual.
• A skills development programme for TVET apprentices and those who have left school.

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