Reeracoen Study Finds Malaysian Employers Taking a More Targeted Approach to Hiring in 2026

27 January 2026

KUALA LUMPUR: Reeracoen Malaysia has released its Hiring Trends Year-on-Year Comparison 2024 vs. 2025, revealing that while Malaysian employers continued to hire in 2025, recruitment strategies have become more selective, disciplined and aligned with long-term workforce needs. Employers are moving away from broad-based recruitment drives towards more targeted, skills-aligned hiring that supports sustainable workforce planning.

This shift comes as organisations contend with rising employment costs, persistent skills mismatches and tighter labour market conditions. Rather than scaling back recruitment entirely, the findings point to a recalibration—prioritising the right talent at the right time, rather than simply expanding headcount.

The annual study analyses hiring data across multiple Malaysian industries, comparing actual recruitment outcomes in 2024 with employers’ hiring intentions and behaviours in 2025.

While demand for talent remains robust, employers are stepping away from large-scale hiring waves. Instead, they are adopting phased and targeted recruitment plans that prioritise roles critical to productivity and business growth. This trend reflects a growing recognition that talent acquisition is a strategic function, rather than a purely operational one.

The report identifies several factors driving this shift. Rising labour costs—including wage adjustments introduced under Budget 2025—combined with ongoing skills mismatches, have increased the significance of each hiring decision. At the same time, shortages in specialised and technical roles have heightened the risks and costs associated with hiring errors.

Despite these challenges, overall hiring demand remains stable, with employers concentrating resources on roles that directly support productivity and long-term growth.

In response, organisations are reassessing how, when and whom they hire. Job readiness, relevant experience and long-term organisational fit are now taking precedence over hiring volume. Market benchmarking and more rigorous candidate assessments are increasingly standard practice.

Yohei Yagi, Country Manager at Reeracoen Malaysia, noted that this evolution is evident across multiple sectors.

“Malaysian employers are still hiring, but they are doing so with greater precision than in previous years,” said Yagi. “Higher employment costs and ongoing skills gaps mean organisations must be more deliberate in their hiring decisions. What we are seeing is a shift towards well-defined, skills-aligned recruitment rather than broad expansion.”

The study highlights recruitment as a strategic lever that directly affects organisational resilience and competitiveness. With margins under pressure, the cost of a mis-hire—impacting productivity, team dynamics and long-term efficiency—has never been higher.

Kenji Naito, Group Chief Executive Officer of Reeracoen Group, said this heightened awareness is influencing recruitment practices across the region.

“Across Asia-Pacific, employers are navigating tighter labour markets alongside rising workforce costs,” said Naito. “In Malaysia, this has resulted in a more disciplined approach to hiring, where accuracy and long-term fit matter more than speed or volume. Recruitment partners play a vital role in helping organisations interpret market conditions and make informed, sustainable hiring decisions.”

Reeracoen developed the Hiring Trends Comparison as an annual study to support business leaders and HR professionals in responding to changing market conditions with clarity and confidence. The report provides actionable insights and benchmarks to enable more strategic workforce planning.

For employers, success in 2026 will increasingly depend on the ability to secure the right skills at the right time—supported by accurate market data and informed recruitment strategies.