Malaysia’s unemployment rate eased to 2.9% in January 2026 from 3.1% in the same month a year earlier, marking its lowest level since November 2014. The number of unemployed persons declined by 4.5% year-on-year to 509.6 thousand, while the number of people outside the labor force fell by 0.7% to 7.11 million, largely due to housework or family responsibilities and participation in schooling or training.
The youth unemployment rate for those aged 15 to 24 edged down to 10.2% from 10.3%. At the same time, total employment increased by 0.5% to 16.77 million, lifting the employment-to-population ratio to 68.8% from 68.5% in January 2025.
Employment in the services sector continued to expand steadily, led by wholesale and retail trade, followed by accommodation and food and beverage service activities, as well as transportation and storage. The labor force participation rate rose to a new record high of 70.9%, compared with 70.6% a year earlier.
