KUALA LUMPUR (July 7): The Department of Statistics Malaysia (DOSM) warned on Thursday (July 7) that the increase in the price of goods will result in inflation that will affect Malaysia's economic recovery and that China’s zero-Covid policy has caused shortcomings and delays in the supply of materials, thus, affecting the global market, especially in the manufacturing sector.

"The crisis of rising prices of [commodities] prevailing in the market had indirectly impacted Malaysia's economic development,” the DOSM said in a statement to announce Malaysia’s latest-reported unemployment rate reading at 3.9% in May 2022.

The country’s May 2022 unemployment rate was unchanged from April 2022’s 3.9%, according to the DOSM.

Looking ahead, the DOSM said the operation of Malaysia's economic sectors and social activities is observed as a contributing factor to the increase in demand for labour in the country.

"In addition, the entry of foreign labour into the country to cope with labour shortages in certain industries is also foreseen as a positive element in ensuring that the labour market remains stable even though it will lead to higher competition and a tight labour market.

"Thus, the labour market is anticipated to be in a positive recovery momentum in the upcoming months,” the DOSM said.

According to the DOSM, Malaysia’s number of unemployed persons declined to 637,700 in May 2022 from 649,300 in April 2022 while the country’s labour force increased to 16.54 million persons in May 2022 from 16.5 million in April 2022.

The country’s unemployment rate is derived by dividing the number of unemployed persons by the labour force figure, according to the DOSM.

DOSM chief statistician Datuk Seri Dr Mohd Uzir Mahidin said in the statement that the recovery in the Malaysian labour market in May 2022 continued to be stable and aligned with full operation of all economic activities.

Mohd Uzir said the encouraging economic activities during the month stimulated more demand for goods and services, thus, providing more opportunities for businesses to revive their revenues.

"The labour market is also observed to expand as more demand and supply of labour prevails in the market to accommodate the needs of the growing economic activities. Thus, the labour force situation during the month remained resilient registering a month-on-month increase in the number of labour force [at] 0.2% to record 16.54 million persons (April 2022: 16.5 million persons).

"Subsequently, the labour force participation rate in May 2022 increased marginally to 69.5% (April 2022: 69.4%). This situation was steered by steady employment growth while unemployment reduced further.

“The number of employed persons ascended further in May 2022 by 0.3% to record 15.9 million persons (April 2022: 15.85 million persons). Meanwhile, the number of unemployed persons during the month continued to decline with a reduction of 1.8% to 637,700 persons (April 2022: 649,300 persons). Accordingly, the unemployment rate during the month remained at 3.9%,” he said.

In April 2022, Malaysia's unemployment rate dipped to 3.9% from 4.1% a month earlier due to the increase in the country's employment numbers while the unemployment figure declined as economic activities flourished due to the reopening of the country's borders in tandem with its transition to the Covid-19 endemic phase on April 1, 2022 from pandemic previously, according to DOSM’s statement on June 9, 2022.

At 3.9%, Malaysia's April 2022 unemployment rate dipped below 4% for the first time since the Covid-19 outbreak began in early 2020, according to the DOSM.