“Although seen as a better short-term alternative, it will affect the quality of work and the workers’ well-being in the long run,” he said at the Labour Market Forum 2021 held virtually today.

The labour market was now facing challenges to remain competitive, he said, and issues of unemployment and structural unemployment, among others, had to be tackled to ensure the country’s economic recovery.

Among the challenges are the continuous increase in skill-related underemployment rate since the third quarter of 2020.

“Structural unemployment can be linked to the slow demand for labour in the skilled job category.

“Industries are facing problems absorbing the supply of tertiary-educated labour or workers with jobs that match their educational background,” he said.

Uzir said the reduced operating hours for economic sectors during the pandemic also contributed to the increase of time-related underemployment to 2.2% in the third quarter of 2021 from the quarterly average of 1.3% in 2019.

“The rise of employment in this category involving those who can afford to and are willing to work more hours can be linked to the transition to a flexible job arrangement in terms of time and place of work,” he said. Gig workers were among those in the category, he added.

Meanwhile, the country’s labour market showed a recovery trend by recording a lower unemployment rate of 4.3% last October with the number of unemployed totalling 705,000 people.

Despite being the lowest rate recorded since March 2020, it surpassed the rate recorded before the pandemic, which was around 3.3% or approximately 500,000 people.

“Most countries, including the United States, United Kingdom and Canada, have not been able to get their unemployment rate back to what it was before the pandemic,” he said.