Malaysia’s Unemployment Rate Holds Steady At 3.0% In July 2025

Samuel Chua

10th September 2025 - 2 min read

Malaysia’s unemployment rate in July 2025 remained unchanged at 3.0% [PDF], with 521,600 people unemployed, according to the Department of Statistics Malaysia (DOSM). The figure was broadly consistent with June 2025, when 518,700 people were unemployed.

Chief Statistician Malaysia, Datuk Seri Dr Mohd Uzir Mahidin, said the labour market maintained its positive trajectory despite global economic uncertainty. “The labour market sustained its positive momentum, underpinned by continued improvements in domestic economics despite global economic uncertainty,” he said.

The labour force grew by 0.2% month-on-month to 17.47 million, while the labour force participation rate stood at 70.8%.

Employment Continues To Grow

Employment also expanded in July, rising by 0.2% to 16.95 million people. Uzir noted that most Malaysians remained in paid employment, with employees making up 75% of the workforce, or 12.71 million people. The number of own-account workers, such as small business owners and freelancers, also increased slightly to 3.21 million.

The services sector sustained its momentum, particularly in wholesale and retail trade, accommodation, food and beverage, and information and communication activities. Growth was also recorded in manufacturing, construction, agriculture, and mining.

The number of people working less than 30 hours a week declined by 1.0% to 240,500. Those who were underemployed but willing to work more hours also fell by 2.1% to 134,800. “The underemployment rate stayed at 0.8%, reflecting stable labour utilisation,” said Uzir.

Youth Unemployment Remains Higher

Youth unemployment remained above the national average. For individuals aged 15 to 24, the rate was 10.2%, or 298,900 people. Among those aged 15 to 30, the rate stood at 6.2%, with 399,000 people unemployed.

Of the total unemployed, nearly 80% were actively seeking work. “Within this group, most had been unemployed for less than three months, while around 5% were unemployed for over a year,” said Uzir.

More People Outside The Labour Force

The number of people outside the labour force rose slightly to 7.19 million in July. Household responsibilities made up the largest share at 43.7%, followed by schooling or training at 40.8%.

Outlook For Malaysia’s Labour Market

Looking ahead, DOSM expects the labour market to remain steady. “Malaysia’s labour market is expected to stay stable, inclusive, and resilient, with positive prospects in the coming months,” said Uzir.

He added that strong domestic fundamentals, strategic investments, and proactive government policies would continue to support employment. “A focus on upskilling, innovation, and the green economy will be key drivers to ensure Malaysia’s labour market remains globally competitive,” he said.

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