Wrapping up 2024, Malaysia stands on firmer ground, having weathered the ups and downs of a challenging global economy. Business pressed on through geopolitical strains and rising debt burdens, making considerable progress toward recovery and reduced inflation. However,he impacts on hiring was more apparent in sectors sensitive to global economic turbulence.
Ai Rene Tan, Country Manager at Robert Walters Malaysia, “Geopolitical tensions have prompted many companies to diversify their supply chains. Many were drawn to Malaysia’s favourable business environment and skilled labour face, and they opted to base their manufacturing and logistics operations here. This led to a substantial increase in foreign direct investment.”
Meanwhile, Malaysia also enjoyed steady employment growth and consistently low unemployment rates, solidifying its appeal as a sought-after work destination – especially for talent across Southeast Asia. The abundance of job opportunities combined with a high quality of life boosts its attractiveness. Moreover, the rise of hybrid work models is enabling cross-border talent engagement, further elevating Malaysia’s standing as a desirable place to live and work.
Read on to find out more about Ai Rene’s expectations for Malaysia’s labour market in 2025.
Hiring focus shifts to skills, flexibility and ESG impact
According to Ai Rene, skills-first hiring is gaining momentum as companies look beyond traditional qualifications to prioritise the skills and competencies employees can contribute. Increasingly, companies are mapping out skills frameworks, which identifies essential skills needed by the organisation and how their teams stack up against these needs. “By redesigning work structures and providing training and support to gain industry-critical skills, companies aim to build a highly productive workforce that is agile and future-ready,” she explains.
Contract hiring is also gaining ground as organisations seek alternatives for greater flexibility in staffing, addressing issues like temporary absences, project-based vacancies or seasonal spikes in workloads. With contract positions, companies unlock access to a wider pool of talent without the long-term commitment associated with permanent hires, thereby saving costs and keeping up with evolving business needs.
More and more, candidates are expressing a preference for employers that champion diversity, equity, and inclusion (DEI) and environmental, social and governance (ESG) initiatives. To match this growing awareness around ethical business practices and environmental stewardship and better appeal to the modern workforce, companies will highlight their efforts in these areas in their employer branding even more.
Top hiring trends for 2025
Malaysia's hiring landscape in 2025 will see significant shifts driven by new policies and investments, with a focus on upskilling, digital transformation, and creating high-value job opportunities across various industries.
“Several developments signal that Malaysia’s job market is in for a transformative year ahead. In 2025, we can expect to see more high-value roles and increased digital capabilities across various regions and specialisations,” concludes Ai Rene.
The Madani Budget 2025 includes initiatives to encourage high-value activities and diversify the economy. The New Investment Incentive Framework, launched in late 2025, extends tax incentives to advanced areas in the electrical and electronics (E&E) sector. Tax deductions for educational institutions offering AI, robotics, and sustainable technology courses will also help create high-paying jobs.
Several developments signal that Malaysia’s job market is in for a transformative year ahead. In 2025, we can expect to see more high-value roles and increased digital capabilities across various regions and specialisations
These initiatives align with the National Semiconductor Strategy's goal of transforming Malaysia's E&E sector from basic-advanced semiconductor assembly and high-tech manufacturing. RM25 billion has been allocated over a decade for incentives, infrastructure, and talent development – all to bridge skill gaps and attract high-value equipment manufacturers.
To position Malaysia as a talent and infrastructure hub, the government has launched the National Fund-of-Funds (NFOF) to support venture capital in start-ups, alongside Kumpulan Wang Persaraan's Pioneer Fund Programme to boost local entrepreneurial efforts. Meanwhile, investments from tech giants like AWS, Microsoft, Google, and Oracle are set to reach USD16.9 billion by 2038. Google’s new data centre in Selangor is also set to create 26,500 jobs by 2030, supporting the demand for AI-driven innovation and digital services and boosting tech sector opportunities.
Lastly, the Forest City Special Financial Zone (SFZ) is expected to drive job growth in Johor, with hiring demand in finance, compliance, supply chain management, real estate, retail, and infrastructure development.
Recruitment process gets competitive with AI
In Malaysia, businesses are going beyond permanent recruitment, adapting talent acquisition strategies to meet evolving organisational priorities.
A survey by Robert Walters reveals that over 50% of employees now include generative artificial intelligence (AI) skill sets in job requirements. AI is also reshaping hiring processes, with recruiting teams leveraging tools and algorithms to automate tasks like resume screening and candidate assessment. Some organisations even utilise AI to analyse diversity metrics, helping to foster equity and inclusivity.
As AI adoption grows, Ai Rene highlights the need for companies to be mindful of potential accuracy and ethical concerns, emphasising that “practices like bias detection, transparency, and accountability will become essential in human resources processes.”
To stay competitive, companies are increasingly relying on market intelligence for insights into talent trends, salary data, and talent mapping. This approach provides a clearer picture of the hiring landscape, enabling more informed decisions about hiring and compensation.
There’s also a noticeable rise in executive search requests, with companies not only seeking top-level executives and board members but also investing in leadership coaching. These services often include psychometric assessments, onboarding support, and assistance with leadership transitions, equipping organisations to build strong, adaptable leadership teams.
Advice on talent attraction and retention
Talent attraction and retention has become more complex than before with fluid job market dynamics, rising competition and shifting candidate motivations.
Leadership teams should aspire towards qualities like empathy, authenticity and openness, as it helps businesses create a positive work culture where employees feel supported and listened to. This is especially crucial as most consider company culture as one of the top factors that influence their decision to stay or leave a company. Moreover, it is now more necessary than ever to understand what employees want as a ‘one size fits all’ approach no longer works in today’s job market.
Already, companies know that candidates are looking for more than a typical salary and benefits package. “While traditional benefits such as medical coverage and learning and development pathways will continue to have their place, we’re seeing more companies modernising their benefits packages to include tailored benefits like flexible work hours, paternity leave and mental health support,” states Ai Rene.
In the area of career development, she suggests making several improvements to address employees’ unique goals and aspirations. Besides regular performance reviews and mentorship programs, other offerings like personalised development plans and skills-building workshops help employees identify their strengths and growth areas. International assignments are also seen as highly valuable, as they provide the potential of significant personal and professional growth.
“Nevertheless, open and honest communication remains essential. Let employees know about the opportunities available to them and encourage them to take ownership of their own professional journeys” she concludes.
Salaries rise
Job movers can expect salary increments to fall between 20 – 30% in the year ahead. However, talent with specialised, in-demand skill sets may see increments larger than 30%.
Find out more
Request access to our 2025 Salary Survey to benchmark salaries and to find out more about key hiring trends in Malaysia.
