Stable, Healthy Job Market Led To Growing Domestic Demand Contribution, MIDF Says
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Full-employment condition for Malaysia continues. Malaysia’s labour market remained healthy and stable as unemployment rate kept at post-pandemic low of 3.3% in Mar-24.
MIDF Research cited labour force and employment figures grew steadily by +1.7%yoy and +1.9%yoy respectively.
The unemployed persons stayed at 567K in Mar-24, approximately 48K higher than average jobless persons 519K in 2019.
For youth aged 15~24, the unemployment rate stayed at post pandemic low of 10.6% (2019: 10.4%). By employment type, employee which made up about 75.2% of the employment increased steadily by +1.3%yoy while employer (3.5% of employment) and own-account-worker (18.3% of employment) increased by +4.8%yoy and +4.2%yoy respectively in the final month of 1QCY24.
MIDF expects better domestic consumption contribution for 1QCY24 GDP performance due to steady employment growth +2.0%yoy (4QCY23: +2.0%yoy) and low jobless rate 3.3% (4QCY23: 3.3%).
MIDF foresees the jobless rate to remain at 3.3% in 2024.
As of 3MCY24, average jobless rate was 3.3% (2023: 3.4%) while labour force and employment increased by +1.7% (2023: +2.0%) and +2.0% (2023: +2.4%).
The labour market in Malaysia is expected to strengthen further in 2024, backed by encouraging momentum in the domestic economy and recovery in external trade.
Malaysia’s average unemployment rate is expected to maintain at 3.3% in 2024. The return of non-citizens workers is expected to boost overall employment and reduce the jobless rate.
As of 2023, non-citizens’ employment is -2.4% lower than pre-pandemic levels. The downside risks to Malaysia’s labour market among others is lower-than-expected external trade recovery and nosedived of global commodity prices.
Average 3MCY24 job vacancies 126.2K. For the first quarter of 2024, average job vacancies were 126.2K, lower than last year’s 166.9K. However, the job vacancies were still higher than pre-pandemic average 114K (2009-2019).
As compared to Feb-24, job vacancies increased by +17.3%mom among others supported by manufacturing +50.5%mom and services +17.8%mom.
MIDF expects the average job vacancies to hover at 100~120K per month level for 2024 thanks to external trade recovery and resilient domestic demand.
Moderating American job market. Job creation in the US slowed more than expected in Apr-24 as the nonfarm payrolls rose by +175K (Mar-24: +315K), the softest expansion in 6-month and below market expectations of +243K.
Private payrolls increased by +167K, the slowest increase in 5-month. Most of the additional hirings were added in the services sector.
Meanwhile, government payrolls rose by +8K, the weakest growth in nearly 1.5-year. The unemployment rate increased to 3.9% against market expectations for the rate to remain at 3.8%. As for Euro Area, jobless rate maintained at record low 6.5% in Mar-24.
Across the globe, China’s unemployment rate edged lower at 5.2% in Mar-24, better than 7-month recorded in the previous month. We foresee better recovery in China’s job market in 2024 amid external trade recovery and improving domestic demand, MIDF said in its recent Economic Review.
