Malaysia’s unemployment rate in June 2021 has deteriorated again after four consecutive months of improvement, said the latest labour report by the Department of Statistics Malaysia (DOSM). In June 2021, the unemployment rate saw a 0.3% increase from the previous month, putting it at 4.8% as comparison to 4.5% in May 2021.

With this, DOSM reported that there was a total of 768,700 unemployed persons in the country in June 2021, as compared to the previous month’s number of 728,100 persons. Chief statistician Datuk Seri Dr Mohd Uzir Mahiddin attributed this increase to the government’s continued effort in flattening the surge of Covid-19 cases.

“The rise of new daily cases has resulted in the implementation of the full movement control order (FMCO) during the month, whereby only essential economy and services sectors were permitted to operate, encompassing business activities related to food & beverage, utilities, security, health & medical care, transportation, banking, communications, and essential construction activities. Small businesses such as food or beverage stalls or hawkers were also allowed to operate during this period,” explained Datuk Seri Uzir.

Accordingly, the number of unemployed persons in June 2021 showed a decline of 0.5% to 15.3 million persons. This is in comparison with a total of 15.37 million employed persons in the previous month. The employment-to-population ratio also fell by 0.4 percentage points to 65%.

DOSM’s report further highlighted that some of the labour force had moved into inactivity, which subsequently led to a decline in the number of labour force, from 16.10 million persons in May 2021 to 16.07 million persons in June 2021. It said that this was the first decrease of labour force recorded since April 2020, when the pandemic hit Malaysian shores. Consequently, this decline also caused the labour force participation rate to drop from 68.5% in May to 68.3% in June.

Aside from that, DOSM also noted that there was a significant hike of 661,400 person in the number of employed persons who were temporarily not working since May. This brought the total to 801,100 persons. Curiously, a similar trend was observed during the first implementation of MCO back in 2020 as well.

Aside from the monthly unemployment rate, DOSM also released data on the labour force with relation to the second quarter of 2021 (2Q21). Overall, the labour force fell by 36,100 persons to 15.97 million persons from the previous quarter, amid declines in both employed and unemployed persons.

“During this quarter, the number of employed persons decreased by 0.2% to 15.21 million persons, particularly in services, agriculture, and mining and quarrying sectors. The unemployment rate of the second quarter stood at 4.8%, registering 764,900 unemployed persons,” the report noted. Meanwhile, the labour force participation rate for 2Q21 stood at 68.3%.

As for the unemployment rate by state, DOSM observed that the highest unemployment rate for 2Q21 occurred in Labuan (8.8%), Sabah (8.7%), Perlis (5.3%), Kelantan (4.8%), and Selangor (4.4%).

Finally, Datuk Seri Uzir reiterated that herd immunity is essential in speeding up the country’s economic recovery, enabling businesses to resume their operations. Along with the National Covid-19 Vaccination Programme, the various stimulus packages from the government may help the economy and labour market economies to rebound. However, this is not taking into account the new and more lethal Covid-19 variants.

(Source: DOSM [1, 2, 3])

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• Covid-19
• Department of Statistics Malaysia
• DOSM
• Malaysia Unemployment Rate
• Unemployment
• Unemployment Rate