Malaysia’s RM8 billion TVET allocation and RM3 billion in HRD Corp training funds could strengthen workforce development, but Jobstreet by SEEK says skills programmes must lead to relevant jobs and career progression.
By Nicholas Lam, Managing Director, Jobstreet by SEEK Malaysia
Budget 2027’s substantial investment in skills development presents an opportunity to strengthen Malaysia’s workforce, but the focus must extend beyond training opportunities to ensure they translate into relevant employment and career progression, according to Jobstreet by SEEK Malaysia managing director Nicholas Lam.
The budget allocates RM8 billion to technical and vocational education and training (TVET) across ministries, while HRD Corp will receive RM3 billion to support three million training opportunities.
Lam said the next challenge is to ensure these programmes align with labour market demand and equip Malaysians with skills that employers need.
Skills Mismatch Remains a Challenge Despite Lower Unemployment
Malaysia’s unemployment rate fell to 2.9% in August 2026, according to the Department of Statistics Malaysia (DOSM). However, employment growth alone does not show whether workers’ qualifications and capabilities are being used effectively.
DOSM’s Labour Market Review for the second quarter of 2026 found that skill-related underemployment among employed people with tertiary education stood at 35.2%. This highlights the need to connect educational qualifications and skills with suitable employment opportunities.
Meanwhile, Jobstreet by SEEK’s platform data showed that job advertisements on its platform, excluding free advertisements, remained broadly unchanged in the first half of 2026 compared with the same period a year earlier.
Although hiring activity continues, better employment outcomes depend on matching workers’ skills with employers’ requirements.
AI Skills Demand Expands Beyond the Technology Sector
As workplace requirements evolve, artificial intelligence (AI) capabilities are becoming increasingly relevant across different industries.
Jobstreet by SEEK data showed that AI-related job advertisements accounted for 2.9% of all job advertisements in Malaysia in August 2026, up from 0.9% in January 2024.
Within information and communications technology (ICT), AI-related advertisements rose to 14% of all job advertisements in August 2026, compared with 5% in 2024.
Demand is also growing beyond the technology sector, with increases in industries such as Advertising, Arts & Media and Marketing & Communications. This suggests that AI-related capabilities are becoming relevant to a wider range of occupations.
For jobseekers, Lam said targeted skills development can begin with understanding the requirements of desired roles, identifying gaps in their capabilities and selecting training programmes that address those needs.
Recognising how existing experience and skills can transfer to other roles or industries is also important when exploring career opportunities.
Employers Must Turn Training into Career Progression
Employers also have a role in ensuring that skills development leads to better employment outcomes.
This includes investing in existing employees, aligning training with workplace requirements and giving staff opportunities to apply their new knowledge and capabilities.
Training is more likely to deliver value when employees understand how it relates to their responsibilities and supports their career progression.
Lam also highlighted the importance of hiring practices that recognise relevant experience and transferable skills. Candidates should not be overlooked simply because they lack a specific qualification or come from a different industry.
Assessing what candidates can do, rather than relying solely on formal qualifications or previous industry experience, could help employers access a broader pool of talent.
Better Job Matches Can Improve Workplace Happiness
Connecting workers with suitable roles is important not only for productivity but also for employee satisfaction and fulfilment.
Jobstreet by SEEK’s Workplace Happiness Index 2026 found that 68% of Malaysian workers considered their jobs fulfilling. Purpose at work emerged as the strongest driver of workplace happiness, followed by satisfaction with day-to-day responsibilities.
Helping people move into roles where they can contribute meaningfully, apply their capabilities and continue developing their skills should therefore form part of Malaysia’s wider employability agenda.
Connecting Skills Investment with Labour Market Needs
Ultimately, stronger collaboration between jobseekers, employers and training providers will determine how effectively Malaysia’s investment in skills development responds to labour market demand.
Budget 2027’s TVET and training allocations offer an opportunity to strengthen these connections, potentially helping Malaysians secure more relevant employment and progress in their careers while enabling businesses to respond to changing workforce requirements.
The key, Lam said, is to ensure that skills development translates into practical workplace capabilities and better job matches, rather than measuring success solely by the number of training opportunities provided.
