Malaysia’s Unemployment Rate To Remain At 3.0 Pct In 2025 And 2026 -- MBSB IB

KUALA LUMPUR, Dec 10 (Bernama) -- Malaysia’s unemployment rate is expected to remain at 3.0 per cent in 2025 and 2026, supported by steady employment growth and continued hiring in the domestic-oriented services sector, according to MBSB Investment Bank Bhd (MBSB IB).

In a research note today, MBSB IB said the jobless rate eased from an average of 3.3 per cent in 2024 to 3.0 per cent this year and is expected to be sustained at 3.0 per cent in 2026.

“Investment expansion, project realisation, and key national initiatives, including the 13th Malaysia Plan, National Semiconductor Strategy, New Industrial Master Plan 2030, and the government-linked Enterprises Activation and Reform Programme, will further boost job creation and strengthen labour demand in Malaysia,” it said.

It said a healthy labour market will continue to support domestic consumption and economic growth heading into 2026.

“The key downside risk stems from tariff-related disruptions, which could dampen global demand and hiring in export- and commodity-linked sectors.

“On the upside, robust tourism activity ahead of Visit Malaysia Year 2026 and stronger demand for electrical and electronics and tech products also provide additional support to employment prospects,” it said. 

Meanwhile, MBSB IB noted that Malaysia’s labour market remained resilient in October 2025, with the unemployment rate holding steady at 3.0 per cent for the sixth consecutive month, the lowest level in a decade.

“This was driven by steady employment growth of 3.1 per cent year-on-year (y-o-y), which has outpaced labour force expansion of 2.8 per cent y-o-y since August 2021, with both indicators maintaining their pace from the previous month,” it said. 

It elaborated that the number of unemployed people was unchanged at 519,000, although on an annual basis it fell at a slower pace of 4.9 per cent y-o-y compared with a 5.5 per cent decline in September 2025.

“The youth unemployment rate (aged 15-24) held steady at 10.1 per cent, underscoring persistently elevated joblessness among young people and the challenges faced by graduates and new entrants in securing employment and transitioning into the labour market,” it added.

-- BERNAMA