Building on a remarkable year that saw the sector's value surge to RM 151.5 billion, the Malaysian construction industry is not just laying bricks but solidifying its role as a cornerstone of national growth.
Key Takeaways
- In 2023, the Malaysia construction industry valued at RM 151.5 billion, representing 3.8% of national GDP
- The construction sector grew by 15.6% year-on-year in Q4 2023, driven by civil engineering works up 29.7%
- Total construction projects completed in 2023 numbered 28,456 with a value of RM 98.2 billion
- Total employment in construction reached 1.32 million in 2023
- Construction sector employed 9.5% of total workforce in Q4 2023
- Average monthly wages in construction industry stood at RM 3,200 in 2023
- Total MRT projects under construction span 100km with 50 stations as of 2024
- Pan Borneo Sabah Highway Phase 1A completed 85% by end-2023, covering 384km
- Johor Bahru-Singapore RTS Link project 35% complete as of March 2024
- Steel consumption in construction reached 8.2 million tonnes in 2023
- Cement production capacity utilization at 78% with 28 million tonnes output in 2023
- Average price of ready-mixed concrete RM 250 per cubic meter in 2023
- CIDB Act 520 mandates registration for contractors with projects over RM 20,000
- Construction Industry Transformation Programme 2016-2020 achieved 92% KPIs by 2023 review
- 12th Malaysia Plan allocates RM 400 billion for infrastructure development 2021-2025
Malaysia's construction industry surged in 2023, driven by residential and civil engineering growth.
Economic Indicators
- In 2023, the Malaysia construction industry valued at RM 151.5 billion, representing 3.8% of national GDP
- The construction sector grew by 15.6% year-on-year in Q4 2023, driven by civil engineering works up 29.7%
- Total construction projects completed in 2023 numbered 28,456 with a value of RM 98.2 billion
- Residential buildings accounted for 42% of total construction works value in 2023 at RM 63.7 billion
- Non-residential buildings contributed RM 45.1 billion or 29.8% to 2023 construction value
- Civil engineering sector value reached RM 42.7 billion in 2023, up 29.7% from previous year
- Construction Gross Value Added (GVA) increased by 12.5% to RM 151.5 billion in 2023
- Sector's contribution to GDP rose from 3.2% in 2022 to 3.8% in 2023
- Average monthly value of construction projects awarded in 2023 was RM 12.6 billion
- Projected construction industry growth of 5.5% in 2024
- Inflation in construction materials averaged 2.1% in 2023
- Total value of ongoing construction projects as of 2023 stood at RM 354 billion
- Specialised construction works valued at RM 12.9 billion in 2023
- Construction sector's GVA per capita estimated at RM 4,500 in 2023
- Year-on-year growth in construction output was 10.2% for January-November 2023
Economic Indicators Interpretation
While homebuilders were busy laying foundations for our future bedrooms, it was the civil engineers, constructing nearly a third more infrastructure than the year before, who truly paved the way for the industry's robust 15.6% year-end sprint.
Employment Statistics
- Total employment in construction reached 1.32 million in 2023
- Construction sector employed 9.5% of total workforce in Q4 2023
- Average monthly wages in construction industry stood at RM 3,200 in 2023
- Foreign workers comprised 65% of construction workforce, totaling 858,000 in 2023
- Unemployment rate in construction sector was 2.8% in 2023, lower than national average
- Number of registered construction workers under CIDB grew by 5.2% to 2.1 million in 2023
- Female participation in construction labor force was 12.3% in 2023
- Skilled workers accounted for 28% of total construction employment in 2023
- Labour productivity in construction improved by 8.7% to RM 115,000 per worker in 2023
- Over 150,000 construction workers completed CIS 7 certification in 2023
- Youth employment (15-24 years) in construction was 18.4% of sector workforce in 2023
- Average working hours per week in construction sector: 48.2 hours in 2023
- Construction accidents reported: 1,256 cases with 92 fatalities in 2023
- Job vacancy rate in construction was 4.1% as of Q4 2023
- 75,000 new jobs created in construction sector in 2023
Employment Statistics Interpretation
While the Malaysian construction industry proudly builds a nation, employing nearly 1 in 10 workers, its foundation reveals a stark reliance on a lower-waged foreign workforce and persistent safety and demographic challenges that must be addressed as it reaches for the sky.
Material and Cost Analysis
- Steel consumption in construction reached 8.2 million tonnes in 2023
- Cement production capacity utilization at 78% with 28 million tonnes output in 2023
- Average price of ready-mixed concrete RM 250 per cubic meter in 2023
- Construction cost index increased by 3.2% in 2023 to base 2015=100
- Imported sand usage dropped 15% to 12 million tonnes due to local sourcing in 2023
- Asphalt price averaged RM 2,800 per tonne in Q4 2023
- Timber imports for construction fell 8% to RM 4.5 billion in 2023
- Electrical cables and wires cost index up 5.1% year-on-year in 2023
- Paint and coatings consumption 450,000 tonnes in construction sector 2023
- Average building cost for high-rise residential RM 2,800 per sqm in 2023
- Reinforcement bar (rebar) price RM 2,900 per tonne average in Klang Valley 2023
- Glass products price index rose 4.2% in 2023
- Plumbing materials cost increased 2.8% to RM 15,000 average per unit in 2023
- Aggregate supply reached 150 million tonnes for construction in 2023
- PVC pipes price up 6.5% to RM 5.20 per meter in 2023
- Construction machinery rental rates averaged RM 45,000 per month for excavators in 2023
- Labour cost component 35% of total construction costs in 2023
- Overall tender price index for buildings up 4.5% in 2023
- Aluminium extrusions price index increased 3.9% year-on-year 2023
Material and Cost Analysis Interpretation
The Malaysian construction sector is flexing its muscles with impressive steel and concrete output, but builders are sweating as rising costs for everything from cables to paint and a stubborn 35% labour chunk keep the pressure on tight margins.
Policy and Regulation
- CIDB Act 520 mandates registration for contractors with projects over RM 20,000
- Construction Industry Transformation Programme 2016-2020 achieved 92% KPIs by 2023 review
- 12th Malaysia Plan allocates RM 400 billion for infrastructure development 2021-2025
- Green Building Index (GBI) certified 1,200 projects totaling 150 million sqm by 2023
- Foreign worker levy for construction set at RM 1,850 per worker annually from 2023
- Mandatory CIS certification for all site supervisory personnel since 2020
- Industrialised Building System (IBS) score mandatory >70% for government projects
- MyConstructionPoints (MyCP) system tracks contractor performance digitally since 2022
- 10% Bumiputera contractor participation target in all government projects
- Net Zero Carbon Buildings Roadmap targets 30% low-carbon buildings by 2030
- Prompt Payment Policy ensures 14-day payment to subcontractors since 2021
- Construction Works Act 2015 requires insurance for all projects over RM 20,000
- Digitalisation roadmap mandates BIM adoption for projects >RM 100 million by 2024
- Safety and Health Policy targets zero fatalities in high-risk projects by 2025
- RM 100 billion Madani Economy Framework boosts construction via 8 pillars 2023-2025
- Local content requirement 40% for materials in government construction contracts
- 1,500 G1/G2 contractors registered under CIDB as of 2023
- Uniform Building By-Laws (UBBL) amended for sustainability in 2023
- FDI in construction sector approved RM 15.2 billion in 2023
Policy and Regulation Interpretation
While Malaysia tightens its screws with mandates on foreign workers, contractor registration, and prompt payments, it's simultaneously laying down a green and digital runway for a RM 400 billion construction boom, proving that building a modern nation requires both a firm rulebook and ambitious blueprints.
Project Developments
- Total MRT projects under construction span 100km with 50 stations as of 2024
- Pan Borneo Sabah Highway Phase 1A completed 85% by end-2023, covering 384km
- Johor Bahru-Singapore RTS Link project 35% complete as of March 2024
- 12,500 affordable housing units under PPR programme handed over in 2023
- ECER infrastructure projects worth RM 25 billion ongoing in 2023
- Penang Transport Master Plan LRT project: 17.8km alignment approved
- 45 data centre projects licensed with RM 85 billion investment by 2023
- KLIA Aeropolis development covers 4,200 acres with RM 50 billion value
- 1,200MW floating solar projects under implementation in 2023
- Flood mitigation projects in 10 states valued at RM 4.2 billion completed 2023
- Iskandar Malaysia total projects value RM 120 billion since inception
- 350km of new highways constructed under 12MP by 2023
- Tun Razak Exchange (TRX) 97% complete with 19 towers by Q1 2024
- 8,000MW solar capacity targeted under Green Technology Master Plan by 2025
- Penang Second Bridge spans 24km, completed ahead of schedule in 2023 maintenance phase
- 15,000 units of MyHabitat homes under construction nationwide in 2023
- East Coast Rail Link (ECRL) 20% progress with 665km track by 2024
Project Developments Interpretation
While some might call it an identity crisis, Malaysia’s construction industry is quite clearly and ambitiously building its future all at once—from the tracks and towers that connect its people to the solar panels and data hubs that will power their progress.
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