9th February 2021 - 3 min read
The unemployment rate in Malaysia for December 2020 has remained unchanged at 4.8% since November 2020, according to the latest data from the Department of Statistics Malaysia (DOSM). Meanwhile, the number of unemployed persons increased by 1.1% since the previous month to settle at a total of 772,900 people in December.
According to DOSM’s report, the labour market in Malaysia is still influenced by the Covid-19 pandemic and economic consequences, thereby causing the recovery momentum in the labour market to be slower. In spite of that, it emphasised that the labour force continued to remain competitive as the number of employed persons also increased alongside that of unemployed persons.
“In December 2020, the number of employed persons edged up month-on-month by 0.1% or equivalent to 19.3 thousand persons to 15.22 million persons after registering a marginal decrease in the previous month. The employment-to-population ratio – which indicates the ability of an economy to create employment – was unchanged at 65.1%,” explained chief statistician Datuk Seri Dr Mohd Uzir Mahidin in a statement.
To further dissect the number of employed persons by category, those in the employee category have increased by 0.2% from the previous month to come up to 11.81 million persons in December. This made up 77.6% of overall employment in the country. Meanwhile, own-account workers (self-employed) fell by 0.6% to 2.4 million persons, decreasing for the third month in a row. This group accounted for another 15.8% of overall employment. The remaining 6.6% of the overall employment consisted of unpaid family worker (3.6%) and employers (3%).
Aside from that, DOSM also noted that the number of employed persons who are temporarily not working rose from 142,000 persons in November to 146,200 persons this month. This increase is attributed to the implementation of phases of the movement control order, as well as short school break and festive holidays.
On top of month-on-month comparisons, DOSM’s latest data also reported that the annual unemployment rate for 2020 is set at 4.5% – the highest rate recorded since 1993. The annual labour force participation rate has also slipped by 0.3% to record 68.4% in 2020 from 68.7% in 2019.
“The health crisis has given a huge impact on the labour force which led to the unemployment rate rising above 4% as against an average of 3% recorded in the pre-crisis period. Thus, the unemployment rate rose to 4.5% in 2020, the highest rate recorded since 1993 (4.1%),” DOSM noted in its report.
DOSM also foresees that Malaysia’s labour market will continue to remain in a challenging situation in early 2021, but initiatives introduced by the government will likely soften the impact dealt to it. For context, Malaysia’s unemployment rate soared to an unprecedented height in March, April, and May 2020 due to Covid-19 and the implementation of the first MCO. It eventually improved in June, July, August, and September, but began to increase slightly again in October and November.
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