KUALA LUMPUR: The unemployment rate in Malaysia fell to 3.2 per cent in August (July: 3.3 per cent), a 55-month low, reflecting a continued recovery in the labour market conditions amid steady economic recovery.
Kenanga Research said unemployment numbers fell by 0.9 per cent month-on-month (MoM), extending a 37-month decline and at the fastest pace in 23 months.
In absolute terms, the number of unemployed persons fell to 558,500 (July: 563,700), slowly approaching the pre-pandemic level (February 2020: 525,200).
The actively unemployed fell to 446,600 (July: 450,700), the lowest since April 2020 (459,800) while those unemployed for less than three months decreased further to 275,800 (July: 277,000).
The number of employed persons in the services sector continued to increase, particularly in wholesale and retail trade, food and beverage services, and transformation and storage activities.
Similarly, manufacturing, construction, mining & quarrying, and agriculture sectors also expanded.
Labour force participation rate remained at a record high at 70.4 per cent in August (July: 70.4 per cent), with the addition of 24,200 persons (July: 24,600) reaching a total of 17.22 million persons, partly as those outside the labour force decreased slightly.
In comparison, there was lower unemployment rate recorded among advanced economies.
The US saw a drop in September (4.1 per cent; Aug: 4.2 per cent) with the number of unemployed people reduced to 6.8 million.
Japan's unrmployment rate fell to a two-month low in August (2.5 per cent; July: 2.7 per cent), as employment rose 0.4 per cent to 67.9 million.
However, the job availability ratio declined to 1.23 from July's 1.24.
Kenanga Research maintained its forecast despite the improvement in August's unemployment rate, as the year-to-date average currently stands at 3.3 per cent.
"Nevertheless, we still expect hiring activity to stay strong through the rest of the year backed by an increase in job openings, higher investment approved and robust expansion in the services sector thanks to increased tourist arrivals.
"In addition, the improvement in the manufacturing sector particularly the export-driven industries led by electrical and electronics is expected to support employment growth," it said.