Profile of SMEs in Malaysia

Department of Statistics, Malaysia (DOSM) conducted the first census on SMEs in Malaysia in 2005. The first census entitled ‘Baseline Census of Establishments and Enterprises 2005’ was for the reference year 2003. Subsequently, the second census on SMEs named the ‘Economic Census 2011: Profile of Small and Medium Enterprises’ was conducted for the reference year 2010. The Economic Census 2016: Profile of SMEs for the reference year 2015 was officially released on 29 September 2017. This latest Census was undertaken by DOSM during the period of April until November 2016.

In the newly-released Economic Census 2016, the classification of SMEs used was based on the new definition of SMEs which came into effect on 1 January 2014. The Census revealed that there were altogether 907,065 SMEs operating in Malaysia in 2015, which represent 98.5% of the total establishments of 920,624 firms. There has been an increment of more than 260,000 establishments, registering an average growth rate of 7.3% per annum from year 2010 until 2015.

 

SMEs by Economic Sector

Looking across key economic sectors, SMEs are highly concentrated in the services sector, which accounted for 89.2% (809,126 firms) of total SME establishments. Meanwhile, about 5.3% of SMEs (47,698) are involved in the manufacturing sector, followed by 4.3% (39,158) in the construction sector, 1.1% (10,218) in the agriculture sector with the remaining 0.1% (865) in the mining & quarrying sector.

 

   

 

• In the services sector, majority of SMEs are predominantly in the distributive trade sub-sector (wholesale & retail trade services) including repair of motor vehicles & motorcycles, followed by food & beverages services and transportation & storages services.
• In the manufacturing sector, most SMEs are concentrated in the textiles & wearing apparel, food & beverages products, fabricated metal and machinery & equipment sub-sectors.
• In the construction sector, SMEs were mainly involved in the special trades sub-sector, forming about 38.2% of total establishments in the sector. Special trades refer to the construction of parts of buildings such as plumbing installation, concrete works and plastering, without full responsibility for the entire project.
• In the agriculture sector, more than two-third of the SMEs were in the crops sub-sector. Meanwhile, about 25.5% were involved in livestock and fisheries activities while the remaining 6.7% were made up of SMEs in the forestry & logging sub-sector.
• In the mining & quarrying sector, almost three-quarter of the SMEs involved in the quarrying business. Quarrying refers to the stone extraction from the earth as well as works related to rough cutting, shaping, grinding and crushing of the stones.

 

SMEs by Firm Size

In terms of size, majority of the SMEs were microenterprises, constituting 76.5% of total SMEs in Malaysia. Meanwhile, small-sized SMEs formed 21.2% of the total SME establishments and the balance 2.3% were medium-sized SMEs. Microenterprises, which are mostly business operators with less than five full-time employees, were predominant across the services sector. Meanwhile, large proportion of SMEs in the manufacturing, construction and agriculture sectors were well-balanced across microenterprises and small-sized firms, with only small portion were medium-sized firms. On the other hand, more than half of the SMEs in the mining & quarrying sector was made up of small-sized firms.

 

 

SMEs by Geographical Location

Findings of the Economic Census 2016 showed that more than 60% of SMEs are mainly concentrated in the top five States namely Selangor (19.8%), Kuala Lumpur (14.7%), Johor (10.8%), Perak (8.3%) and Pulau Pinang (7.4%).

 

Women-owned SMEs

Women-owned SMEs are firms of which women hold at least 51% of the equity, or the CEOs are women that own at least 10% of the equity. In 2015, women-owned SMEs accounted for 186,930 firms or about 20.6% of total SMEs in Malaysia. In terms of breakdown by sectors, majority 92.7% of women-owned are SMEs engaged in the services sector, followed by the manufacturing sector (5.1%). Women however are less involved in the construction, agriculture as well as mining & quarrying sectors.

 

 

Source: Department of Statistics Malaysia (DOSM)
For more information, please refer SME Annual Report 2016/17 (https://www.smecorp.gov.my/index.php/en/sme-annual-report-2015-16?id=2150)