Labour force records slowest growth since 2014

The closure of operations for most businesses during the MCO has impacted loss of employment and job seekers could hardly find jobs


MALAYSIA’S labour force recorded a marginal growth of 0.6% to 15.71 million persons in April 2020, the slowest since September 2014.

The latest report by the Department of Statistics Malaysia (DoSM), entitled “Key Statistics of Labour Force, Malaysia, April 2020”, stated that the number of labour force month-on-month (MoM) decreased 0.8% against March 2020.

Consequently, the labour force participation rate (LFPR) in April 2020 declined 0.5 percentage point to 68.1%.

“The decrease of LFPR during the month was due to outflows from labour force.

“The last time Malaysia posted LFPR at 68.1% was in December 2017,” chief statistician Datuk Seri Dr Mohd Uzir Mahidin said in a statement yesterday.

Male and female LFPR also decreased 0.4 percentage point and 0.5 percentage point respectively, registering 80.3% and 55.1% compared to March 2020.

Mohd Uzir said the unemployment rate spiked to 5% as unemployed persons went up 48.8% compared to a year ago to 778,800 persons.

The closure of operations for most businesses during the early phase of the Movement Control Order (MCO), has caused loss of employment and job seekers could hardly find jobs.

“In April 2020, the working population decreased 156,400 persons (-1%) year-on-year to 14.93 million persons,” Mohd Uzir said.

He said the most affected employed persons were in the manufacturing and services sectors namely accommodation and food and beverage; arts, entertainment and recreation; and other services such as beauty centres and salons.

“MoM, the number of working population decreased 299,000 (-2%) compared to March 2020 which recorded 15.23 million persons,” he said.

According to the survey, 2.59 million persons were own account workers in April 2020 which largely comprised of traders or small traders (farmer’s market, night markets, catering, stalls, freelancers), smallholders, tour operators including umrah and others.

These groups of workers were exposed to the risk of job and income losses following the MCO. From the survey, MCO has affected 4.87 million employed persons who were not working in April 2020.

However, Mohd Uzir said they are not categorised as unemployed as they have work to return to.

Overall, he said all sectors of the economy were affected during Phases 2 and 3 of the MCO in April 2020, especially for non-essential services.

He said Malaysia’s labour market for May 2020 is expected to be further affected following the Conditional MCO which started on May 5, as businesses were still not fully in operation.

He added that during this period, companies will have the tendency to downsize to ease the burden of the operating costs as they had predicted a decline in their business revenue.

“The Recovery MCO kicked off on June 10 where reactivation of businesses for most sectors and interstate travels are allowed.

“These are predicted to spur businesses and steer the improvement of the job market, especially in the travel and tourism-related industries,” Mohd Uzir said.