News: Malaysia sees more competitive talent market in 2024

Employment Landscape

Malaysia sees more competitive talent market in 2024

A brighter economic outlook for Malaysia means a busier and more competitive talent market. How is this going to affect salaries and talent availability?
Malaysia sees more competitive talent market in 2024

The Malaysian talent market is expected to be more competitive this year as employees feel more confident looking for better career opportunities amid a growing economy. 

A study by global HR service provider Randstad found that roles in the fields of emerging technologies, oil and gas, and human resources and compliance will see a lot of job mobility throughout the year. 

This mobility is fueled by a growing focus on cybersecurity, gaming, shared services, legal compliance, renewable energy, and digital human resources.

“These projections are also driven by Malaysia’s biggest budget announcement amounting to RM393.8 billion (USD83.3 billion) to counter global headwinds and boost domestic growth,” the study said.

“Small and medium enterprises, including start-ups, will receive funding and tax incentives to motivate the shift towards digitalization and energy sustainability,” it added.

The Malaysian Finance Ministry forecast that the economy will grow by 4% to 5% in 2024, a clear sign of the country slowly bouncing back from the pandemic slump.

Higher salary, growth, work-life balance

Because the demand for talent will continue to outstrip supply, the competition will result in high salary expectations for employees changing jobs, ranging from 15% to 35% increases depending on the vertical.

However, salary increments for those who are staying will be at least 4%, similar to what it was throughout 2023.

“Besides financial remuneration, hybrid working arrangements remain sought-after by candidates, with employers offering flexibility gaining a competitive advantage,” Randstad reported.  

A 2023 report by the same organization found that work-life balance remains the top motivation for half of the country’s workforce to move to another job. 

Next to work-life balance, a lot of Malaysians are also motivated to look for an organization that will give them growth opportunities.

The same study also found that 42% of Malaysia’s millennial workforce have the biggest desire to look for better opportunities elsewhere, followed by Gen Z workers. 

READ MRE | Aon Predicts Flat Salaries in Malaysia and Singapore for 2024

The most in-demand roles for emerging technologies

The study said there are two main drivers of growth in Malaysia’s emerging technologies market: cybersecurity and gaming.

In the cybersecurity sector, the Malaysian government has allotted RM360 million (USD76.1 million) to develop a 5G cybersecurity testing network and mount programs to reskill workers.

Likewise, the government has invested RM30 million (USD6.3 million) to promote Malaysian e-sports, while more players from the private sector and educational institutions are doing their part. 

With this development, the market is expected to see a rise in demand for software developers, software engineers, programmers, and automation testers and engineers.

Game developers, 3D artists, data analysts, and digital transformation lead roles are also expected to be in demand this year, according to the report.

“Soft skills are more important than ever as digital transformation moves tech from the server room to the boardroom,” the report said. 

“Communication and problem-solving skills remain in demand, and candidates who excel in these areas can generally command a premium salary,” it added.

READ MORE | 2024 Projections for Malaysia: High pay raises predicted towards retaining talent

Malaysia as Asia’s oil and gas hub

Volatile global fuel prices due to geopolitical tensions overseas have paved the way for a growth opportunity in Malaysia’s oil and gas sector. 

Government support has been in full-throttle mode, while main players in the oil and gas space are planning to ramp up their expenditures until 2027. 

“With the annual growth forecast at over 2.6% per year by the end of the decade, Malaysia looks well-placed to become Asia’s main oil and gas hub,” Randstad reported.

Another unlikely driver for Malaysia's oil and gas sector is the continuing push for renewable energy. Despite targeting net zero emissions by 2050, there is still a strong demand for petrochemicals, with increased investment, which will result in more jobs for the sector. 

“The top three most in-demand oil and gas roles are in digital oilfield technologies, geoscience and reservoir modeling, and renewable energy integration,” the report said. 

Growth in HR and legal sectors

In the human resources and legal sectors, several factors are driving growth: The environment, social, and governance (ESG) movement, the push for greater sustainability, and shared services.

According to the study, the booming shared services space in Malaysia is expected to be worth US6.7 billion by 2025.

Because of low operational costs and large talent pools, Malaysia has been ranked as the third most attractive location for shared services in 2023. 

“Traditionally shared services have focused largely on areas such as IT support, certain HR functions such as payroll, and legal services such as contract management,” it said.

“While that looks set to continue into the foreseeable future, we also see growth in newer areas such as financial services and corporate secretarial functions,” it added.

The most in-demand careers in human resources include labor law compliance, human resources information systems (HRIS), compensation and benefits, and organizational design. 

In the legal space, roles in corporate exercises such as mergers and acquisitions, contract management and compliance, corporate secretarial services, privacy, and data protection will be in demand. 

Meanwhile, there’s a huge opportunity for workers to upskill as the government allocated RM1.6 billion to provide training opportunities for existing company employees and HR specialists.

“By tapping into these government programs, companies can upskill their existing workforce while also bridging a vital gap between employee expectations and their experience,” Randstad said.

Strategies in a competitive talent market

Because the talent market in Malaysia is set to be extra competitive this year, the study recommended that organizations speed up their hiring process and make fast offers.

Top job seekers will likely receive multiple offers, and it’s up to the organization how fast they can secure their prospective talents. 

There is also a strong emphasis on the employer brand in standing out from the competition, according to Randstad, encouraging companies to partner with educational institutions.

In creating the best employer brand, the report stressed the importance of communicating positive workplace relationships, flexible working arrangements, and work-life balance. 

“Going into 2024, employers need to develop and promote a full compensation package, which could include L&D opportunities, hybrid work, and a sense of purpose, to attract talent who are looking for a job that offers more than pay,” the report stated.

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Topics: Employment Landscape

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