MIDF maintains Malaysia's unemployment rate forecast at 3.8 pct in 2022

KUALA LUMPUR, Sept 9 (Bernama) -- MIDF Research continues to see Malaysia’s unemployment rate declining to 3.8 per cent in 2022 from 4.6 per cent in 2021.

However, the projected jobless rate is still higher than the pre-pandemic level of 3.4 per cent.

“The labour market in Malaysia is expected to strengthen further in the second half of 2022, underpinned by upbeat momentum in the domestic economy and steady expansion in the external sector,” it said in an economic review today.

MIDF Research estimated that employment growth to be at 2.5 per cent this year from 2.0 per cent last year.

From January to July 2022, the jobless rate averaged 4.0 per cent, while employment growth stood at 3.5 per cent year-on-year (y-o-y).

“Recovery of Malaysia’s labour market continued as the jobless rate descended to a new pandemic low of 3.7 per cent in July 2022.

“Underpinned by robust domestic demand and external trade sector, labour force and employment growth hit new record highs of 3.3 per cent y-o-y and 4.5 per cent y-o-y, respectively,” it said, adding that unemployment dropped further by 20.2 per cent y-o-y, the largest contraction rate recorded so far. 

Robust growth in employment was notably driven by employers (11.6 per cent y-o-y), self-account workers (10.8 per cent y-o-y), and unpaid family workers (14.1 per cent y-o-y).

The employee segment, which represents 76 per cent of total employment, grew higher by 2.3 per cent y-o-y.

“With this upbeat labour market performance, we are optimistic about stronger consumer spending in the second half of 2022 and onwards.

“Plus, the receding unemployment rate may lead Bank Negara Malaysia to consider furthering normalisation of the overnight policy rate in the Monetary Policy Committee meeting,” it said.

-- BERNAMA