SINGAPORE: Retrenchments in Singapore rose in the third quarter of 2023 after declining in the previous quarter, though the labour market expanded despite the weaker economic outlook.
According to advance labour market estimates released by the Ministry of Manpower (MOM) on Thursday (Oct 26), total employment grew for the eighth consecutive quarter, with increases for both residents and non-residents.
It noted that retrenchments and unemployment also rose, though unemployment rates remained low.
“This suggests that retrenched workers have been able to find new employment quickly,” the ministry said.
A total of 4,100 people were retrenched in the third quarter of 2023, as compared to 3,200 in the previous quarter, with the majority of this increase coming from the wholesale trade sector. A total of 3,820 people were retrenched in the first quarter of 2023.
The third-quarter retrenchments reflect the “weaker external outlook the sector faced”, MOM said, noting that the number of retrenchments in other sectors “remained broadly stable or declined”.
“Business reorganisation/restructuring remained the top reason for retrenchments in the third quarter of 2023,” it added.
GROWTH HOLDS STEADY
Total employment excluding migrant domestic workers rose for the eighth straight quarter by 24,000 in the third quarter of the year, which the ministry said was “comparable to the previous quarter”.
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According to MOM, employment growth came from both residents and non-residents, with resident employment expanding in growth sectors like financial services and professional services – which generally had higher-paying jobs – as well as in health and social services.
Meanwhile, non-resident employment expanded in sectors such as construction, retail trade, food and beverage services, and administrative and support services.
UNEMPLOYMENT ON “SLOW UPTREND”, MAY RISE FURTHER
Unemployment rates have been “largely stable and remained low” in September despite the slight increase in July, MOM said.
Preliminary figures showed that unemployment rates in September were 2.8 per cent for residents, 3 per cent for non-residents and 2 per cent overall.
The ministry cautioned that while the labour market has continued to expand, the pace of unemployment growth has slowed compared to a year ago, amid the global economic slowdown.
“Business expectations worsened in September 2023,” it said. “The proportion of firms which indicated an intention to hire in the next three months fell from 58.2 per cent to 42.8 per cent.
“Similarly, the proportion of firms with an intention to raise wages dropped as well, from 28 per cent to 18 per cent.”
The ministry also said that while unemployment rates remained low due to continued labour market tightness, they “have been on a slow uptrend, and may continue to rise further”.
“The government encourages employers and workers to make full use of available programmes to remain competitive and resilient amidst economic uncertainty,” it added.
It also encouraged employers to “press on with business transformation, upskill and reskill their workers, and adapt to the changing environment”.
“We remain committed to supporting our workers to find good jobs despite the economic uncertainty ahead.”
On MOM’s latest labour market report, NTUC assistant secretary-general Patrick Tay wrote in a Facebook post on Thursday that he was glad to see unemployment figures staying low.
However, he noted the total retrenchments so far this year had crossed the 10,000 mark due to “cyclical factors such as a weakening in demand across the globe”.
“I expect we may end the year 2023 with overall layoff numbers higher than pre-COVID in 2018 and 2019,” he added.
“Overall hiring sentiments and employment remain cautious and uncertain save for those industries which are gradually bouncing back from the (COVID-19) pandemic such as aviation, travel and tourism, MICE, and the modern services and healthcare/social services spaces.”
The full third-quarter labour market report will be released in mid-December and will include a comprehensive breakdown of resident and non-resident employment, number of job vacancies and re-entry rates among retrenched residents.