Unemployment rate fell in September

The decline was observed in agriculture and construction which may reflect shortages of labour supply in both sectors


THE unemployment rate eased in September 2020 to 4.6%, with the number of unemployed falling to 737,500 from 741,600 persons recorded in August 2020.

The Department of Statistics Malaysia (DoSM) chief statistician Datuk Seri Dr Mohd Uzir Mahidin in a statement yesterday noted a continuous recovery is seen in the country’s labour force supply during the month amid challenges to contain the Covid-19 pandemic via various phases of the Movement Control Order.

“Unemployment rate dropped slightly as the number of unemployed fell by 0.6% month-on-month to record 737,500 persons from 741,600 persons in August 2020.

“On the contrary, employment continued to increase, where employed persons rose 0.3% in September versus August at 0.5% to 15.19 million persons mainly in the manufacturing and services sector,” he said.

He said the decline in employment was observed in agriculture and construction sectors of which this may reflect shortages of labour supply in both sectors.

“The employment-to-population ratio for September 2020 remained at 65.2%. Looking at the employed person by the status of employment, the employee’s category rose by 14,900 persons to record 11.73 million persons against the previous month,” he said, adding own-account workers encompassed 2.43 million persons, an increase of 0.7% against August 2020.

Meanwhile, there were 100,700 of employed persons who were temporarily not working compared to 102,000 persons recorded in Aug 2020.

“This group of persons, who were most likely not able to work was not categorised as unemployed as they had work to return to,” Mohd Uzir said.

The labour force registered a total of 15.93 million persons in September 2020, with an increase of 0.2%.

The labour force participation rate (LFPR) remained at 68.4%, while those outside the labour force rose by 0.1% to 7.36 million with the largest composition due to housework and family responsibilities.

On a quarterly basis, the labour supply situation posted a decline to 4.7% in the third quarter of 2020 (3Q20), from a high rate or 5.1% in the previous quarter.

“The lower rate is attributed by the resumption of almost all economic sectors including social, educational and religious activities,” he said.

In addition, domestic tourism activities revived gradually following the permissions for interstate travel during the quarter, thus an increase in employed persons by 1.4% to 15.1 million in the services, manufacturing and construction sectors.

As of 3Q20, the nation’s employment, unemployment rate and LFPR situation has improved gradually, but not yet reaching the normal level prior to the pandemic.

“Looking at the current situation with a spike of new cases, especially in certain parts of the country since the end of September 2020, it is foreseen that the labour market will face more challenges in forth-coming months,” he said.

In relation to the labour force statistics up to September 2020 and the current scenario, DoSM has revised the forecast of the unemployment rate for the year to range between 4.4% and 4.7% against an earlier forecast of 3.5% to 5.5%.

“With this revised rate, the forecasted number of unemployed for the year will be in the range of 701,000 to 729,000 persons,” he said.