KUALA LUMPUR (Oct 9): Malaysia's industrial production index (IPI) rose 5% year-on-year (y-o-y) in August 2026, up from 4.7% in July, driven by stronger manufacturing and electricity output, the Department of Statistics Malaysia (DOSM) said.
DOSM said in a statement on Friday that manufacturing sales climbed to RM185 billion, up by 9.9% y-o-y from RM168.3 billion a year earlier.
The robust export-oriented industries and a broad-based improvement in manufacturing resulted in the manufacturing sector expanding by 7.4% from 6.4% in July, while the electricity sector grew 9% from 5.5% previously.
“The mining sector contracted 7.4%, following declines in crude oil and condensate production [12.2%] and natural gas production [4.3%],” it said.
On a month-on-month (m-o-m) basis, the IPI rebounded 2.6% in August 2026 from a 2% contraction in July. A 3.4% expansion in manufacturing drove this rebound, followed by a 1.2% rise in the electricity sector, DOSM said.
“Cumulatively, the IPI increased by 5.6% in the first eight months of 2026 compared with 2.6% in the same period last year,” it said.
Dissecting the manufacturing sector further, DOSM said export-oriented industries grew 9.1% in August, compared with 6.7% in July, supported by the manufacture of computer, electronic and optical products, which expanded 18.8%, and machinery and equipment, which grew 13.8%.
“Domestic-oriented industries grew 3.9%, supported by basic metals manufacturing, which rose 9.9%, and food processing products, which increased 6.5%.
“Subsequently, the capacity utilisation rate of Malaysia's manufacturing industry in August 2026 also rose to 84.1%, against 83.2% in July,” it said.
“The number of employees in the manufacturing sector rose by 1.2% to 2.43 million, while total salaries and wages paid rose by 3.5% to RM8.55 billion.
DOSM also said the sales value per employee rose by 8.7% to RM76,148, while the average monthly salary per employee rose by 2.3% to RM3,519.
Cumulatively, manufacturing sales rose 7.9% to RM1.39 trillion in January-August 2026 versus 3.5% in the same period last year.
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