PETALING JAYA: The number of jobs in Malaysia - both filled and available - has reached a record high of 9.25 million, but bosses have created fewer new positions, particularly in low-skilled jobs.
Experts said the decline reflected employers' growing caution over rising labour and operating costs, as well as a shift towards automation and technology that is reshaping work towards higher-skilled and multi-skilled roles.
The number of new jobs created fell 1.2% to 31,550 in the second quarter of this year from 31,920 in the same period last year, according to the Department of Statistics (DOSM) Q2 2026 employment statistics.
Newly created low-skilled positions dropped 17%, even as overall labour demand continued to grow.
Economic activities that recorded declines in new jobs created included information and communication (-33%), transportation and storage (-31%), textile, clothing and leather products (-20%) and construction (-11%).
The number of new jobs created in the food, beverage and accommodation sector fell 22% in second quarter from the previous quarter.
Malaysian Employers Federation Datuk Dr Syed Hussain Syed Husman said the future workforce, particularly in micro, small and medium enterprises (MSMEs), was likely to become more skills-intensive.
"Bosses increasingly look for workers who can operate technology, troubleshoot equipment, analyse information, interact with customers, manage processes and perform several functions rather than undertake only one task," he said.
He said MSMEs were becoming more cautious about creating additional low-skilled positions as every new worker represented a continuing cost commitment, including wages, statutory contributions, overtime and training.
"The increase in the minimum wage has also raised the cost base for labour-intensive businesses.
At the same time, many MSMEs are facing higher operating costs, including utilities, rentals, raw materials, logistics and financing costs.
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He said jobs most exposed include those involving repetitive manual tasks, basic data entry and administrative processing, simple cashiering, repetitive warehouse activities, basic production-line operations, routine customer service, certain food preparation processes and basic logistics coordination.
Syed Hussain said rising labour costs were strengthening the business case for automation, digitalisation and better work processes.
"This is not necessarily about replacing workers wholesale. For many MSMEs, it is about using technology to enable fewer workers to produce more output, while reallocating workers to higher-value functions," he said.
Automation could also create demand for technicians, equipment operators, digital administrators, data-related personnel, maintenance specialists and workers able to operate technology-enabled systems.
He said government support should focus on making automation and digitalisation affordable for MSMEs while giving workers opportunities to acquire skills for new roles.
He added that semi-skilled workers remained critical to the economy, accounting for 62.1% of total jobs and 64.1% of jobs created in DOSM's first-quarter data.
SME Association of Malaysia president Chin Chee Seong said rising labour and operating costs were accelerating the shift towards automation, digitalisation and artificial intelligence.
He called for automation and digitalisation grants, AI adoption incentives, affordable financing, accelerated capital allowances and practical workforce training.
“Foreign investors should develop Malaysian suppliers, while local companies willing to invest in technology and expansion should receive equally strong encouragement,” he said.
Small and Medium Enterprises Association president Datuk William Ng said digital commerce would increase demand for digital marketing specialists, e-commerce fulfilment coordinators and data administrators.
However, he warned that fewer new entry-level jobs could push young workers into the gig economy as an immediate income buffer, potentially delaying career progression and structured skills acquisition.
"Addressing this requires stronger emphasis on industry-led TVET, micro-credentials and work-based apprenticeships to prepare fresh entrants for the actual technical roles businesses need," he said.
