Malaysia recorded 5,900 job losses in March 2026, a 21.3% drop from the 7,500 cases seen in February which sounds like progress, right?
But zoom out, and the picture gets a lot grimmer.
According to a research note by Hong Leong Investment Bank (HLIB), citing data from the Social Security Organisation (SOCSO), the first quarter of 2026 saw a total of 24,100 Malaysians retrenched, a massive 47% surge compared to the same three months last year.
And if you live in Selangor or KL? You’re in the epicentre.
Selangor and KL made up more than half of all layoffs in March
HLIB’s data shows that Selangor alone accounted for 29.3% of all loss-of-employment (LOE) cases in March, with Kuala Lumpur close behind at 25.6%. That’s over half of every retrenchment in the country, concentrated in two states.
Why these two states? Simply put, that’s where most of Malaysia’s corporate and industrial activity is based.
HLIB noted that states with a high concentration of industrial and export-oriented businesses will naturally see higher layoff numbers and nothing fits that description more than the Klang Valley.
Who’s getting hit the hardest?
HLIB singled out manufacturing as the “weakest link” for job security right now, largely because it’s so exposed to global trade tensions.
But layoffs are also hitting wholesale and retail trade, as well as the information and communication sector hard.
On social media, Malaysians who’ve been affected have been sharing their stories and they paint a very real picture of what’s going on:
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“I got retrenched in March 2026 from an MNC. They wanted to reduce headcount in my function in Malaysia and hired people in the Philippines instead. The downside of remote work: companies can shift roles to wherever salaries are cheaper.”
“It’s no longer cost-effective for MNCs to hire Malaysians. The Ringgit has appreciated, increasing hiring costs by 10–15%. Indonesia and Vietnam will take factory jobs. Philippines will take BPO and office roles.”
“Sales dropped from 2024. Couldn’t sustain the headcount. Last year they started cutting salaries by mutual agreement, but still couldn’t hold on. By end of year, VSS and MSS lists came out.”
“Most companies want to downsize and save money, so they hire fresh grads at lower salaries and let experienced staff go. It’s the game right now.”
If you’ve been retrenched, here’s what you can do
Whether you went through a VSS (Voluntary Separation Scheme), MSS (Mutual Separation Scheme), or got outright terminated, there are a few things worth knowing:
PERKESO/EIS
If your employer has been making Social Security contributions on your behalf, you may be eligible for Employment Insurance System (EIS) benefits, including job search allowances and training support. Check the PERKESO portal or visit a branch.
HRD Corp retraining programmes
Look into upskilling opportunities under the Human Resources Development Corporation, especially in areas like digital skills, AI tools, and cloud tech; the exact areas companies are currently hiring into.
Think remote or freelance
As one retrenched worker put it, if companies can hire remotely from anywhere, so can you work for anyone from anywhere.
It’s not easy, but the gig economy and remote platforms are worth exploring.
