Malaysia’s IPI slips 0.5 per cent in September – DOSM  

Inve$t | Market Sentiments | 10 November 2023

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According to the Department of Statistics Malaysia, the Industrial Production Index continued to decline in September 2023 by 0.5 per cent y-o-y after registering a negative 0.3 per cent recorded in the previous month. The decrease was mainly influenced by the 5.2 per cent downturn in the Mining sector. On the other hand, the Manufacturing sector returned to a marginal growth of 0.4 per cent (August 2023: -0.6%), after experiencing a declining trend for three consecutive months. Meanwhile, the Electricity sector ascended by 2.5 per cent as against 1.9 per cent registered in August 2023. Nevertheless, on a monthly basis, the IPI showed continuous expansion with 1.1 per cent growth, after registering 2.8 per cent in August 2023.

The expansion in Manufacturing output was primarily fuelled by the steady performance of domestic-oriented industries, which accelerated by 5.9 per cent in September 2023 (August 2023: 4.2%). This upturn was underpinned by the Manufacture of fabricated metal products, except machinery & equipment (9.6%); Manufacture of food processing products (8.2%); and Manufacture of other non-metallic mineral products (8.0%).

Conversely, the export-oriented industries which constituted about two-thirds of the Manufacturing output remained on a downward trend, albeit with a smaller negative growth of 2.0 per cent in September 2023, compared to a 2.6 per cent decline in the preceding month. The decrease was mainly attributed to the Manufacture of coke & refined petroleum products (-7.7%); Manufacture of machinery & equipment n.e.c. (-4.9%); and Manufacture of computer, electronics & optical products (-1.9%). This trend aligns with the country’s export performance which fell by 13.7 percent in September 2023, showing improvement from the negative 18.7 per cent registered in August 2023. As compared to the previous month, the production of both domestic-oriented and export-oriented industries grew by 4.4 per cent and 1.1 per cent, respectively.

The output in the Mining sector edged downward by 5.2 per cent in September 2023 as against a positive 0.1 per cent recorded in August 2023. The downward trend was influenced by Natural Gas production which returned to negative territory, with a decline of 7.8 per cent as opposed to the 2.6 per cent increase in August 2023. Additionally, Crude Oil & Condensate output continued its declining trend, registering a negative 1.4 per cent in September 2023 (August 2023: -3.3%). In comparison with the preceding month, the Mining index decreased by 1.6 per cent as compared to the negative 5.4 per cent recorded in August 2023.

In the meantime, the Electricity output advanced further by 2.5 per cent in September 2023 after registering 1.9 per cent growth in the previous month. A m-o-m comparison, the Electricity index declined by 4.0 per cent, contrasting a positive growth of 0.3 per cent recorded in August 2023.

Overall, in the third quarter of 2023, the IPI registered a marginal decline of 0.04 per cent y-o-y as compared to the negative 0.3 per cent recorded in the second quarter of 2023. During the period, the Mining and Manufacturing sectors decreased by 0.4 per cent and 0.1 per cent, respectively. The Electricity generation increased by 2.0 per cent in this quarter, continuing the positive momentum for three consecutive quarters. Nevertheless, in comparison with the second quarter of 2023, the IPI rebounded to 4.2 per cent predominantly backed by the Manufacturing sector at 5.5 per cent, in line with the quarterly expansion of exports. In addition, imports of intermediate goods also posted quarterly increase, thus signalled higher demand for the industrial production.

The IPI expanded at a slower rate of 0.8 per cent as compared to the same period of the previous year which was 7.7 per cent. The increase was supported by the Manufacturing index (1.1%) and the Electricity index (1.7%).  On the other hand, the Mining index dipped by 0.4 per cent.

Malaysia’s unemployment rate drops to 3.4% as labour market shows positive trends – DOSM

According to Department of Statistics Malaysia (DOSM) chief statistician Datuk Seri Dr Mohd Uzir Mahidin, Malaysia’s unemployment figures declined to 573,700 individuals in September 2023, yielding an unemployment rate of 3.4%. The labour force saw a slight 0.1% increase to 16.95 million individuals, maintaining a labour force participation rate (LFPR) of 70.1%.

There was a small rise in employed persons to 16.38 million and a decline in unemployment, reflecting current economic progress. In September 2023, the country’s labour force position remained in a positive growth trend, with a marginal increase in the number of employed persons, while unemployment continued to decrease, in line with the current economic developments.

Within the employment categories, employees numbered 12.33 million, a minor rise, while own-account workers increased slightly to 2.97 million. In terms of sectors, the services sector led employment growth, with positive momentum also in manufacturing, construction, mining, quarrying, and agriculture. 

Specifically, 80% of the unemployed were actively seeking work, showing a minor drop to 458,900 individuals. Youth unemployment rates saw a decrease, with figures dropping to 10.6% for those aged 15-24, and to 6.7% for those aged 15-30. Meanwhile, the count of those outside the labour force edged up by 0.1% to 7.24 million, mainly due to household responsibilities and education.

For 3Q 2023, the labour force climbed by 0.6% to 16.82 million, with employed persons also increasing to 16.25 million, and unemployment falling to 573,100. This resulted in a slight reduction in the unemployment rate to 3.4%. There was a 1.6% increase in those working less than 30 hours per week, marking a rise in time-related under-employment to 189,000 individuals. Skill-related under-employment also rose by 0.4% to 1.92 million people, among those with tertiary education in lower-skill roles.

LFPR across states varied, with Selangor reaching the highest at 77%, indicating greater workforce participation, while the lowest unemployment rate was 0.5% in the Federal Territory of Putrajaya.

Note From The Publisher: We wish all our readers celebrating Deepavali a joyous and illuminated Deepavali celebration with family, relatives and friends. Happy holidays to all our readers.

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