Unemployment continued to fall in Q2 reflecting heightened demand for labour across various economic sectors, according to the Labour Market Review, 2Q24 released on Friday.

Chief Statistician Datuk Seri Dr Mohd Uzir Mahidin reported that the labour force grew by 2.5% to 17.15 million people, largely due to a 2.8% rise in the number of employed individuals, which reached 16.59 million in the second quarter.

“During the same period, the number of unemployed persons continued to decrease by 4.1% to 557,800 persons registering an unemployment rate of 3.3%, unchanged for three consecutive quarters,” he stated.

He added that rising household spending, driven by a robust labour market and broader policy support, contributed to Malaysia’s economic improvement, which saw a growth rate of 5.9% in 2Q24, up from 4.2% in Q1, The Malaysian Reserve reports.

In addition, the expansion in exports and potential investments entering the country have also played key roles in boosting labour demand.

Mohd Uzir reported that the labour supply remained strong with the labour force participation rate rising by 0.5 percentage points year-on-year to 70.5%.

Whereas in regard to underemployment in the second quarter, the number of individuals working fewer than 30 hours per week fell by 1.6% compared to Q1.

“As a result, the number of persons in time-related underemployment decreased by 8.9% to 169,800 persons, with a rate of 1%,” he said.

As the economy progressed in Q2, he noted that labour productivity, measured by value added per employment, increased by 3.1% compared to Q2 last year, reaching RM24,151 per person.

Furthermore, the total hours worked between April and June this year rose by 3.4%, amounting to 9.61 billion hours.

“Consequently, value added per hour worked increased by 2.4% with a value of RM41.7 per hour (2Q23: RM40.7; 1Q24: RM42.1),” he went on to add.