The Malaysian economy gained speed in 2022 after recovering from the economic blow brought on by the pandemic as its growth rate consistently outperformed forecasts. A growth rate of 5% year over year was recorded in the first quarter of 2022. Compared to the 3.9 percent that was attained in the fourth quarter of 2021, this pace was astounding.
Through 2022, the pace stayed the same. A growth rate of 8.9 percent was recorded in the second quarter, while 14.2 percent was attained in the third. The pandemic's crippling effects on Malaysia's economy were being reversed, according to the strong growth rates.
An increase in private consumption was the most important indicator of recovery. The third quarter of 2022 had a 15% year-over-year increase in consumption. As the year went on, the labor market also started to improve. Over the year, the unemployment rate moderated.
The demand for Malaysian exports increased on a global scale. As borders opened and repressed global demand materialized, exports increased. The fact that Malaysian exports rose by almost 19 percent (year over year) in the third quarter of 2022 was not unexpected.
However, despite the fact that there were obvious indications that the Malaysian economy had recovered from the crippling impacts of the pandemic, new issues appeared. A labor scarcity was one of the issues.
For a variety of reasons, migrant laborers who had to leave Malaysia did not come back. However, there was a growing need for their services in various places, including plantations, eateries, and some subsectors of the manufacturing industry.
The crisis between Russia and Ukraine created a significant barrier to Malaysia's recovery. Malaysia's growth was not directly impacted by the war, but rising costs were a result.