Malaysia’s manufacturing expansion loses steam in February

Sales continued to rise year on year, but the month-on-month decline and softer output point to a more moderate pace of expansion.

Malaysia’s manufacturing sector posted a more subdued performance in February 2026, with growth continuing but at a slower pace, according to the latest data from the Department of Statistics Malaysia (DOSM).

The value of sales rose on a year-on-year basis, though the rate of expansion eased compared with previous months. Growth was mainly supported by key sub-sectors, including food, beverages and tobacco, as well as electrical and electronic products.

On a month-on-month basis, however, sales declined, reflecting seasonal factors and softer production activity following the start of the year.

Employment in the manufacturing sector remained broadly stable, with a modest increase in the number of workers. Salaries and wages continued to edge higher, indicating sustained demand for labour despite the slowdown in output growth.

Productivity, measured by sales value per employee, recorded a slight improvement compared with a year earlier, suggesting incremental efficiency gains across the sector.

Overall, the February figures point to a manufacturing industry that remains on a growth path, but at a more moderate and measured pace as firms navigate softer external demand and ongoing economic uncertainty.