KUALA LUMPUR, June 23 — Malaysia’s labour market is expected to strengthen further in the second half of 2022 (2H2022), underpinned by the return of workers from Indonesia today.

Indonesia's ambassador to Malaysia, Hermono, has reportedly said that Malaysia will receive the first group of Indonesian migrant workers today since the reopening its borders, and their arrival is expected to ease the major labour shortage in palm oil plantations.

MIDF Amanah Investment Bank Bhd (MIDF Research) said employment of labourers had declined by 1.8 per cent in 2020 and 2.9 per cent in 2021 — a total of more than 100,000 workers leaving the workforce due to the Covid-19 pandemic.

Non-citizen workers constitute about 10 per cent of Malaysia’s working population.

"Malaysia’s unemployment rate is projected to trend lower this year to 3.8 per cent in 2022 from 4.6 per cent in 2021, underpinned by the domestic reopening and strong economic fundamentals,” the research firm said in a note today.

However, it said that the projected jobless rate would still be higher than pre-pandemic 3.4 per cent.

Employment growth is forecast at 2.5 per cent (2021: 2.0 per cent), while unemployment is expected to shrink by 15.0 per cent this year (2021: +3.0 per cent).

"In the first four months of 2022, employment growth stood at 3.0 per cent year-on-year (y-o-y), and unemployment fell by 12.6 per cent y-o-y,” it added. — Bernama