National competitiveness in the 21st century is fundamentally a human capital challenge. Economic strategies, industrial policies and technological investments will fall short if they are not matched by deliberate and sustained investment in workforce and talent development. Economies that invest in people and build domestic talent ecosystems will generate more innovation and achieve greater resilient growth. As such, the role of human capital is vital in fostering economic growth and development.
In that regard, HRD Corp plays a leading role in meeting this national priority. Established in 1993 and operating under the Ministry of Human Resources of Malaysia (KESUMA), HRD Corp manages the Human Resources Development Fund (HRD Fund) and implements Malaysia’s structured workforce development agenda. HRD Corp is focused on helping employers through their levy contributions, which will be channelled towards strengthening capability development, training, reskilling and upskilling initiatives.
Over the years, employer participation towards the levy contribution has grown steadily. As of November 2025, HRD Corp recorded 105,366 registered employers, a more than 7% increase from the number of registered employers in 2024. HRD Corp’s levy ecosystem at present benefits 4.94 million employees nationwide. Training uptake has also strengthened, reflected by an active levy utilisation rate of 92%, up from 85% the previous year.
In general, enhanced human resource development increases incoming foreign direct investments (FDI) by making the investment climate attractive for foreign investors. This is done through a direct effect of upgraded skill levels of the workforce, as well as via indirect effects such as improved socio-political stability and health. On the other hand, FDI contributes to human resource development since multinational corporations (MNCs) themselves can be active providers of education and training, bringing new skills, information and technology to developing host countries. Ultimately, this complementary effect leads to a virtuous circle of human capital development and FDI where host countries experience a continuous inflow of FDI over time by increasingly attracting higher value-added MNCs, while at the same time upgrading the skill contents of pre-existing MNCs and domestic enterprises.
As a case in point, MIDA reported RM378.5 billion in approved investments in 2024, driven by strong momentum in electrical and electronics, digital infrastructure, green technology and advanced services. Meanwhile, demand for skilled talent also surged in line with the growth of data centres, which attracted RM184.7 billion from 2021 to 2024, according to research by the ISEAS-Yusof Ishak Institute. These trends highlight the need for a coordinated, long-term approach to upskilling and future-readiness across the workforce.
According to a white paper published by the World Economic Forum titled “New Economy Skills: Unlocking the Human Advantage”, employers predict that nearly 40% of the core skills required to do jobs will be disrupted in the next five years. The rate of new roles expected to be created is almost two times the number of jobs to be displaced. In this fast-changing landscape, almost 80% of employers say that reskilling and upskilling will be critical for their business strategy.
While it is not possible to precisely predict the full spectrum of future jobs in a rapidly evolving global economy, there is a shared responsibility to align on “the megatrends” required to build a resilient and future-ready skills ecosystem. Governments, employers and workers must act in concert to ensure that skills systems remain agile and responsive to technological change and shifting labour market demands. Many countries are already demonstrating that strategic, coordinated investments in education, workforce development and technology diffusion can accelerate progress up the global value chain. Ultimately, sustained competitiveness will depend on our collective ability to attract, develop and empower talent that can adapt, innovate and collaborate across borders and sectors.
Towards that end, HRD Corp in 2025 has approved circa RM2.64 billion in levy-based financial assistance for the purpose of upskilling, reskilling and training. HRD Corp’s programmes emphasise training in digitalisation, artificial intelligence, automation, Industry 4.0 technologies, sustainability, green jobs and leadership development, demonstrating its emphasis on both technical skills and human skills. Employers increasingly recognise that while technology may support efficiency, human-centric skills drive innovation, collaboration and long-term productivity.
HRD Corp also has a specific emphasis on the small and medium enterprise (SME) sector. For SMEs, structured training often represents a significant financial commitment. As such, the levy-funded mechanisms provide an accessible pathway to high-quality programmes that help smaller firms strengthen competitiveness, elevate productivity and address capability gaps that may otherwise limit growth. This creates broader benefits across the national ecosystem by raising industry-wide skill baselines.
These efforts complement Malaysia’s national strategies, including the aspirations of Malaysia MADANI, the transformative goals of NIMP 2030, enhancements to the TVET ecosystem and the productivity-driven agendas of RMK12 and RMK13. Workforce readiness forms the foundation of these frameworks and HRD Corp’s role advances their implementation.
As Malaysia enters an era of rapid technological adoption and significant economic transition, HRD Corp’s levy-driven ecosystem supports companies of all sizes in building adaptable, future-ready talent. This investment in people strengthens productivity, supports long-term national resilience and positions Malaysian industries to thrive in an increasingly competitive global landscape.