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Singapore: Retrenchments fall in Q3, resident employment grows faster: MOM
SINGAPORE – Singapore’s labour market improved in the third quarter of this year, compared with the second quarter, despite the continuing heightened Covid-19 restrictions, the Manpower Ministry (MOM) said in advanced estimates released on Friday (Oct 29).
The number of retrenchments fell and total employment decline also slowed – thanks to resident employment, which covers Singapore citizens and permanent residents, growing faster.
Sectors such as travel-related ones are likely to start seeing the light at the end of the tunnel, with vaccinated travel lanes (VTLs) opening up to more countries.
Manpower Minister Tan See Leng said: “This shows that our labour market stayed resilient despite the return to phase two (heightened alert) restrictions in July.
“There continues to be many employment opportunities for our residents, especially in outward-oriented sectors such as professional services and financial services,” he told reporters on Friday during a visit to Deloitte Consulting South-east Asia.
Total employment, excluding migrant domestic workers, fell by 3,400 in the third quarter, which was considerably gentler than the plunge of 16,300 in the second quarter.
The decline was due to non-resident employment, while resident employment grew more quickly instead.
But total employment growth remained K-shaped in the third quarter, with recovery remaining uneven across sectors, MOM noted.
Outward-oriented sectors such as professional services, information and communications, as well as financial services continued to see resident employment expansion.
The three growth sectors are expected to continue powering the economy and labour market for the rest of the year and into 2022, said National Trades Union Congress assistant secretary-general Patrick Tay in a Facebook post.
“With new and transformed jobs and opportunities created in this space and other areas including the gig space, our challenge will be to overcome the structural mismatch of skills or expectations (which causes structural unemployment) as well as under-employment.”
On the other hand, food and beverage (F&B) services, retail trade and accommodation trimmed their resident workforce.
“This reflected ongoing Covid-19 border restrictions and safe management measures imposed in the third quarter,” MOM said.
With these, non-resident employment continued to contract across most sectors in the third quarter.
MOM noted that with Singapore’s recent extension of its stabilisation phase till end-November, it expects the mixed employment trends observed in the third quarter to continue into the next quarter.
It added that sectors such as F&B services and retail trade will continue to be affected, as the extended Covid-19 measures include group size curbs on dining in and other social activities.
The expansion of the VTL and travel-related activities however “may give an uplift to industries such as accommodation and air transport services”, MOM said.
Retrenchments, a key indicator for the labour market, are expected to remain low, MOM added.
There were 2,000 layoffs in the third quarter, which is less than a quarter of the figure recorded during the peak of the pandemic last year. The majority came from the services sector, while 400 came from manufacturing and 100 from construction.
This was a decline from the 2,340 retrenchments seen in the previous quarter.
“Consequently, we expect the incidence of retrenchment in the third quarter – at a projected 1.1 retrenched per 1,000 employees – to fall from the 1.3 registered in the second quarter,” MOM said.
Unemployment rates also fell, although they remain elevated compared with pre-pandemic levels.
Last month, resident unemployment rates stood at 3.5 per cent, while overall unemployment rates were at 2.6 per cent.
This marks the second month of consecutive decline, after the unemployment rates ticked up in July.
Experts agreed that labour conditions continue to look promising in the coming quarters.
OCBC chief economist Selena Ling said: “I’m hopeful that the labour market should gradually improve further into the fourth quarter and 2022. Retrenchments may decline but whether new hiring will continue to grow readily is another question.”
Maybank Kim Eng economist Lee Ju Ye added that total employment should turn positive in the fourth quarter as Singapore learns to live with endemic Covid-19, and with the launch of vaccinated travel lanes.
“This would provide some labour demand for consumer-facing and tourism-related services including F&B services, accommodation, and recreation and culture, although a return to pre-pandemic levels remains a way off,” she said.
“The easing of borders to allow migrant workers to return will be a much-needed boost for sectors like construction,” Ms Lee added.
Dr Tan said: “It’s encouraging that we continue to see our economy and labour market improving from the impact of the pandemic in the third quarter of 2021.
“However, we should also expect that industries and job roles will transform at an accelerated pace and be prepared for these changes.”
He commended Deloitte Consulting for helping with workforce transformation, by partnering Workforce Singapore to run a career conversion programme for consultants.
“To meet new manpower needs as businesses transform, it is important that companies expand their hiring strategies, to look beyond plug-and-play candidates,” he said.
More than 30 mid-career workers have switched to consulting under this programme.
Separately, the firm has hired over 100 professionals since the start of the pandemic last year.
Mr Eugene Ho, Deloitte Consulting South-east Asia regional managing director, said: ” We continue to hire actively despite the Covid-19 pandemic as the demand for consultancy services in the marketplace did not waver, with many businesses looking for transformation solutions to survive and thrive.”
He added that hiring a diverse mix of fresh graduates, consultants and mid-career switchers provides a workplace culture where different ideas can flourish.
Source: https://www.straitstimes.com/singapore/jobs/retrenchments-fall-in-q3-resident-employment-grows-faster-mom