Malaysia faces job shifts as AI reshapes economy & skills

Artificial intelligence is set to reshape Malaysia's economic landscape as both the public and private sectors prepare for far-reaching changes over the next five years.

Recent studies suggest AI could increase Southeast Asia's GDP by USD $1 trillion by 2030, placing Malaysia at the centre of the region's digital transformation. The Department of Statistics Malaysia (DOSM) estimates that 600,000 workers may lose their jobs within the next three to five years as clerical, administrative, and some manufacturing roles are automated.

While these job losses pose significant concerns, global projections indicate a net gain in employment as economies shift towards AI. By 2025, it is anticipated that 85 million jobs will disappear, but 97 million new positions will be created worldwide, underlining the importance of workforce management and reskilling initiatives.

Georg Chmiel, Executive Chairman of Chmiel Global Advisory and a board member of the World Digital Chamber, said, "In the case of Malaysia, applying AI doesn't stop at giving advanced machines to do the work, but to improve the people who work, in order to create more high-value jobs."

He added, "By prioritising AI literacy and comprehensive reskilling initiatives, Malaysia can transform potential disruptions into significant opportunities, ensuring our workforce thrives in the dynamic digital economy."

The Malaysian government has outlined several initiatives to respond to these challenges and position the nation at the forefront of AI adoption in the region. Communications and Digital Minister Gobind Singh Deo has declared AI a cornerstone of the country's economic growth strategy.

This strategy centres on three key pillars: overhauling curricula to focus on digital literacy, accelerating the integration of AI technology in sectors such as healthcare, finance, and manufacturing, and launching collaborative reskilling programmes to prepare workers for jobs in AI-driven industries.

Chmiel explained that these efforts form the basis of a future-ready workforce, ensuring that Malaysia is not just responding to shifting labour market demands but also leading the current era of digital transition.

The urgency for reskilling is underscored by estimates that by 2030, 40% of all jobs will require skills related to AI. Routine-based roles are predicted to be the most vulnerable to automation, prompting a shift in focus towards skills in data science, cybersecurity, and AI ethics.

"An adaptable workforce is fundamental for navigating the evolving job market," emphasises Chmiel. "Collaboration among government, educational institutions, and industries is essential to cultivate a synergistic environment that fosters growth."

Chmiel also highlighted the next five years as a decisive period for Malaysia in its AI journey. He said, "If we lead, we secure our place as Southeast Asia's digital powerhouse—attracting global investment, creating future-proof jobs, and driving sustainable growth. However, lagging would mean risking economic stagnation, widening skills gaps, and losing a generation of workers to technological disruption."

He concluded, saying that the blueprint for success is clear: aggressive reskilling, education reform, and widespread adoption of AI across industries. Now is the time for bold action—from policymakers, businesses, and workers alike.