Unemployment in Malaysia dips in May 2025, driven by strong hiring across sectors

"The country’s labour market portrayed resilience and strong adaptability to global economic and technological changes," said Dato’ Sri Dr Mohd Uzir Mahidin, Chief Statistician Malaysia.

Malaysia’s labour market continued its upward climb in May 2025, with the unemployment rate holding steady at 3%, reflecting the country’s economic resilience amid shifting global dynamics.

According to the latest figures from the Department of Statistics Malaysia (DOSM), the number of unemployed persons dropped to 522,400, down from 525,900 in April. This marked yet another month of decline, reinforcing a broader trend of steady recovery in employment and workforce confidence.

"The country’s labour market portrayed resilience and strong adaptability to global economic and technological changes," said Dato’ Sri Dr Mohd Uzir Mahidin, Chief Statistician Malaysia. "The continued decrease in unemployment, alongside a rise in employment, reflects Malaysia’s positive and encouraging economic performance."

The number of employed persons rose 0.3% month-on-month to 16.86mn, while the labour force expanded to 17.38mn, with participation steady at 70.8%. Notably, employees made up 75.1% of the employed workforce, rising to 12.66mn persons, while own-account workers (freelancers and small business owners) also grew by 0.5% to 3.18mn.

Services sector leads employment growth

Hiring activity in May was particularly strong in the services sector, especially across accommodation and F&B services, wholesale and retail trade, and transport and storage. Employment also rose across manufacturing, construction, agriculture, and mining & quarrying, signalling broad-based momentum.

Youth unemployment declines

Youth unemployment also saw modest improvements. For those aged 15 to 24, the rate declined to 10.2% (297,700 persons), while for youth aged 15 to 30, it stood at 6.2% (399,000 persons). Meanwhile, the number of people out of the labour force inched up slightly to 7.18mn, largely due to housework and education-related responsibilities.

Importantly, long-term unemployment (those jobless for over a year) accounted for just 5.1% of the actively unemployed, suggesting that more jobseekers are finding roles in shorter periods.

Looking ahead: A resilient outlook

According to the Chief Statistician, with government policies, macroeconomic stability, and continued investment in human capital, Malaysia’s labour market is expected to remain on a stable path. "Despite ongoing global challenges, strong domestic fundamentals and sustained investment in human capital help maintain the stability and steady performance of the labour market," he added.

Lead image / DOSM

ALSO READ: Malaysia records RM976.4bn in household income for 2021, with wages and business profits driving 78.4%: DOSM