Malaysia’s female labour force participation rate reached a record high of 56.6% in the fourth quarter of 2025, according to the Department of Statistics Malaysia.

The milestone was announced in the Labour Force Statistics, Malaysia, December and Fourth Quarter 2025 release issued on 11 February 2026. During the same period, the national unemployment rate declined to 2.9%, reflecting continued stability in the labour market.

The data signals sustained progress in female workforce engagement alongside broader employment growth.

Female Participation Reaches Highest Level On Record

Malaysia’s overall labour force participation rate remained unchanged at 70.9% in the fourth quarter of 2025. Male participation stood at 83.3%, while female participation rose to 56.6%, the highest level recorded to date.

State-level data shows that three states exceeded the female labour force participation target set under the Twelfth Malaysia Plan for 2025. W.P. Putrajaya recorded 77.5%, followed by Selangor at 69.0%, and W.P. Kuala Lumpur at 66.0%.

Meanwhile, Terengganu, Kelantan, and Pahang recorded the lowest female participation rates at 42.7%, 45.8%, and 47.4% respectively.

These variations reflect differences in economic structure, employment opportunities, and support systems such as childcare and flexible work arrangements across states.

Labour Force Continues To Expand

Malaysia’s labour force grew by 0.8% in the fourth quarter of 2025 to 17.62 million persons. The number of employed persons also increased by 0.8% to 17.10 million persons.

In December 2025, employment edged up further to 17.13 million persons, while unemployment declined slightly to 517,700 persons. The unemployment rate remained at 2.9%.

The services sector continued to drive employment growth, particularly in wholesale and retail trade, accommodation and food and beverage services, and information and communication activities. Employment also increased in agriculture, manufacturing, and construction, while mining and quarrying recorded a slight decline.

Youth And Underemployment Indicators Remain Stable

Youth unemployment among those aged 15 to 24 years held steady at 10.1% in December 2025. For youths aged 15 to 30 years, the unemployment rate stood at 6.1%.

Time-related underemployment, referring to individuals working less than 30 hours per week and willing to work additional hours, declined to 129,800 persons in the fourth quarter of 2025. The rate remained at 0.8%.

Skill-related underemployment, defined as individuals with tertiary education working in semi-skilled or low-skilled occupations, stood at 1.96 million persons, with a rate of 35.3%.

These indicators suggest that while employment levels are rising, job quality and skills alignment continue to be important considerations.

Outside Labour Force Figures Highlight Care Responsibilities

The number of persons outside the labour force increased slightly to 7.23 million in December 2025.

Among this group, 43.7% cited housework or family responsibilities as the primary reason for not participating in the labour market, while 40.9% were engaged in schooling or training.

These figures remain relevant to female labour participation trends, as caregiving responsibilities continue to influence workforce decisions.

Household Income Implications Of Higher Female Participation

An increase in female labour force participation can directly affect household finances.

When more women are engaged in paid employment, households may benefit from income diversification and greater financial resilience. Dual-income households are generally better positioned to manage rising living costs, debt obligations, and long-term savings goals.

Higher participation can also support more consistent contributions to retirement schemes such as the Employees Provident Fund, strengthening long-term financial security.

How Female Workforce Growth Is Reshaping The Labour Market

The record female labour force participation rate reflects deeper structural shifts rather than short-term fluctuations.

Overall participation remains steady at 70.9%, indicating that workforce growth is increasingly supported by stronger female engagement.

Underemployment indicators have stabilised or declined slightly, pointing to continued labour absorption across key sectors. However, the skill-related underemployment rate of 35.3% shows that job matching and skills alignment remain areas to monitor.

The 12th Malaysia Plan includes targets to raise female participation, and several states have already exceeded those benchmarks. Continued progress may depend on employment flexibility, childcare access, wage growth, and sectoral expansion.

For households, higher female participation strengthens income stability and long-term savings potential. At the national level, a broader and more inclusive workforce supports productivity, labour supply resilience, and sustainable economic growth.

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