More young Malaysians are choosing to work for themselves instead of taking traditional salaried jobs. Figures from the Department of Statistics Malaysia’s MyLabourHub portal show that the number of self-employed workers aged 20 to 24 has more than doubled over twelve years, climbing from 128,000 in 2013 to 286,000 in 2025. That works out to a 123% increase, the sharpest of any age group.

These are counted as own-account workers, meaning people who run their own farm, business, or trade without hiring any paid staff. Their share of the total own-account workforce grew from 5.6% in 2013 to 11% in 2025, so roughly one in nine self-employed workers is now in their early twenties. It also means a growing number of young workers no longer have EPF and PERKESO deducted for them.

Younger, More Urban, And Increasingly Platform-Based

The increase was much more modest among older workers, and the oldest group shrank over the same twelve years.

Age Group	Change in Own-Account Workers, 2013 to 2025
20 to 24	Up 123%
25 to 29	Up 34%
30 to 34	Up 26%
45 to 59	Down between 5% and 20%

The biggest rise is among the youngest workers. These are the years when money in your EPF has the longest time to grow. But when you work for yourself, nobody puts that money in for you.

The profile of self-employment has also changed in other ways. In 2013, own-account workers were split almost evenly between urban and rural areas. By 2025, around two in three were based in urban areas, reflecting a shift away from farms and small rural businesses.

E-hailing drivers, delivery riders, freelance designers, tuition teachers, and small online sellers now make up a much larger share of the self-employed workforce. The World Bank’s companion brief on informal employment in Malaysia found that location-based work platforms registered with the Malaysia Digital Economy Corporation grew from just eight in 2016 to 106 by 2021. During the same period, the number of active workers on those platforms increased from around 18,000 to more than 225,000.

Underemployment Is Pushing Graduates Out Of Formal Jobs

Not every young person becomes self-employed by choice. Khazanah Research Institute’s Shifting Tides report found that 48.6% of Malaysian graduates were overqualified for the jobs they held in 2021, with only 43.4% in roles matching their qualifications. Graduates who begin in a mismatched job tend to remain in one, with more than a third still in that position over time.

A similar pattern appears among informal workers. The World Bank found that in 2020, 73.2% of informally employed workers with tertiary qualifications were in low- or mid-skilled jobs, compared with 26.5% of formally employed graduates.

Informal work also pays less. The World Bank estimated that formally employed workers earned around 30% more than informally employed workers in 2019, after accounting for differences in education, age, sector, ethnicity, and location. Khazanah Research Institute also found that although more graduates have entered self-employment in recent years, many eventually moved back into traditional employment once stable salaried positions became available.

Younger Workers Also Want Control Over Their Hours

For many younger workers, the appeal is simply having more control over when and how they work. That flexibility can make it easier to study part-time or care for family members.

Those hours are not small. DOSM’s Special Release on Time Spent on Unpaid Domestic and Care Work found that Malaysians spend an average of five hours and 12 minutes a day on housework and caregiving, rising to six hours and seven minutes for women. A job with fixed hours has to fit around that, while self-employment can be arranged the other way round.

Khazanah Research Institute has also pointed to digital platforms expanding well beyond e-hailing and food delivery into fields such as copywriting, coding, and childcare, giving younger workers more ways to earn independently.

EPF And PERKESO Are Now Your Responsibility

In a salaried job, your EPF is deducted from your pay every month, and your employer adds another 12% or 13% on top. You are also covered by PERKESO, the social security body that pays out if you are injured at work or fall ill because of your job.

Neither of these happens when you work for yourself. If you freelance for five years without registering, nobody sends you a reminder, and there is no way to pay it in later. You reach your late twenties with five years less in your EPF than someone your age who was on a payroll, plus the dividends that money would have earned.

The Gig Workers Act 2025 (Act 872), which came into full force on 31 March 2026, now requires platform providers to register gig workers with PERKESO and automatically deduct 1.25% from each completed job for contributions. If you work directly with clients instead of through a platform, you can still register yourself under Lindung Kendiri, previously known as the Self-Employment Social Security Scheme. Under Budget 2026, the government subsidises 70% of the contribution for first-time registrants in non-mandatory sectors, and 50% in their second year.

Retirement savings remain voluntary. i-Saraan Plus, introduced in January 2026, gives e-hailing and p-hailing workers a 20% government matching incentive on their EPF contributions, capped at RM600 per year and RM6,000 over a lifetime. Contributing RM3,000 a year earns you the full RM600. Do note that the incentive applies to contributions made through your platform, so contributing directly through i-Akaun may not qualify. Other self-employed workers can join the existing i-Saraan scheme, where RM2,500 a year earns the full RM500 matching incentive, capped at RM5,000 over a lifetime.

Freelancing can cover your bills now, but nobody else is paying into your retirement. If you plan to work this way for a few years, treat EPF and PERKESO as part of the job. Registering for PERKESO only takes minutes online, and i-Saraan is set up through your EPF i-Akaun. So don’t put it off! 

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