Employers in Malaysia entered 2025 with renewed confidence, with nearly half planning to expand their workforce in the first half of the year, according to the latest Hiring, Compensation & Benefits Report 2025 by Jobstreet by SEEK.
The report, based on a survey of 2,279 HR professionals and employers, revealed that 48 per cent of businesses intend to grow their permanent workforce, driven largely by business expansion (83 per cent), the introduction of new roles (58 per cent), and replacement of outgoing staff (43 per cent).
“Businesses are approaching 2025 with cautious optimism, focusing heavily on flexibility, competitive compensation and strategic use of AI,” said Nicholas Lam, managing director of Jobstreet by SEEK Malaysia.
He added, “As AI becomes integral to recruitment processes, businesses must adopt it thoughtfully to ensure inclusivity and effectiveness.”
The report highlights a growing emphasis on digital readiness, with 70 per cent of businesses now assessing candidates’ AI capabilities during recruitment. However, only 36 per cent consider it a critical skill compared to other qualifications.
Recruiters are also increasingly leveraging AI tools, particularly for tasks such as job advertisement creation (71 per cent), candidate screening (59 per cent), and assessments (54 per cent). Nonetheless, 47 per cent of employers remain cautious about AI adoption, citing concerns about the loss of personalisation in recruitment processes.
While optimism is high, the report noted that 2024 had been a year of recalibration for many organisations. Although 74 per cent of respondents viewed the job market as active, 39 per cent of companies reported workforce reductions, particularly in permanent full-time roles, reflecting a landscape still adjusting to post-pandemic shifts.
Competitive compensation packages continue to be critical for attracting and retaining talent. In 2024, over 75 per cent of companies awarded performance bonuses, averaging two months’ salary — an increase from 1.7 months previously. Salary increments were also widespread, with 77 per cent of businesses providing pay rises aligned with Malaysia’s 2.49 per cent inflation rate.
Beyond monetary incentives, companies have enhanced their benefits offerings. Forty-five per cent now offer flexible working hours and family-friendly policies such as nursing rooms and improved medical coverage, in an effort to bolster employee satisfaction and work-life balance.
Malaysia is also making headway on diversity, equity and inclusion (DEI) initiatives. As of January 2025, women hold 33 per cent of board seats among the top 100 public-listed companies, with a broader 27.6 per cent representation across all PLCs.
While only 40 per cent of surveyed companies reported having formal DEI practices, there is growing adoption of measures such as anti-discrimination policies (59 per cent), unconscious bias training (53 per cent), setting clear diversity goals (46 per cent), and blind resume screening (40 per cent).
“Employers in Malaysia are increasingly recognising DEI not just as a moral responsibility but also as a strategic business advantage,” Lam added, while noting that deeper cultural integration of DEI principles remains a work in progress.
To stay competitive, Jobstreet by SEEK recommends that employers:
- Broaden hiring strategies to include part-time, contractual or freelance workers.
- Align salary adjustments with inflation and industry benchmarks.
- Enhance benefits with flexible work arrangements and mental health support.
- Prioritise AI literacy in line with national initiatives.
- Strengthen DEI practices, capitalising on available tax incentives.
As digital transformation and evolving workforce expectations reshape the employment landscape, the Hiring, Compensation & Benefits Report 2025 provides a timely roadmap for businesses seeking to build resilient and future-ready organisations. 