You are here
Resident jobless rate, layoffs fall but job market stays weak
ALTHOUGH resident jobless rate and layoffs fell in the second quarter of 2017, the job market in Singapore remains weak, with mixed views among economists.
While some felt there are green shoots appearing, one cut his full-year job projections by half. Quarter on quarter, resident unemployment rate fell to a seasonally adjusted 3.1 per cent in June 2017, from 3.2 per cent in March 2017, while the jobless rate of citizens was 3.3 per cent in June, down from 3.5 per cent in March.
Overall, unemployment rate remained unchanged at 2.2 per cent in June, based on preliminary figures released by the Ministry of Manpower (MOM) on Friday. About 69,800 residents, including 62,800 citizens, were unemployed in June, lower than 74,400 residents and 67,100 citizens unemployed in March. Total employment fell by 7,800 in Q2, extending the decline seen in Q1. Excluding foreign domestic workers, the decline was larger at 8,400.
MOM attributed the fall to a continued decrease in work permit holders in the construction and manufacturing sectors. Manufacturing shed 2,500 jobs in Q2, although the pace of decline has moderated. Most job losses likely occurred in the marine and offshore sector, said Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye.
Construction had 9,500 fewer jobs in Q2, recording the fourth consecutive quarter of decline, reflecting the slowdown in public and private sector construction activities. Mr Chua said: "Construction faced another foreign worker levy hike in July, which may have led some firms to cut jobs ahead of the increase."
Services continued to add jobs but at a weaker pace - there were 4,100 more jobs in Q2 versus 9,900 more jobs in Q1. Layoffs in Q2 fell - 3,500 workers were retrenched in Q2, lower than 4,000 laid off in Q1 and 4,800 a year ago - and they were broad-based across industries. Outlook for the job market remains uneven across sectors. Hiring in sectors such as construction and marine remains cautious. But five sectors identified by MOM - finance & insurance, infocomms & media, healthcare, professional services and wholesale trade - have potential for job creation.
Mr Chua said it was the "weakest job market since the global financial crisis". He added: "The government shows no letting-up on foreign worker measures, which is probably also hurting local hiring. Singapore may not be able to capitalise on the full extent of the current demand upswing, as firms face overly strict barriers to hiring."
Citibank economist Kit Wei Zheng noted the less negative signals and said if the growth recovery persists, resident unemployment may have possibly peaked. Credit Suisse economist Michael Wan said the better job data supported the call for a pick-up in consumption and retail sales.
In a Facebook post, NTUC Assistant Secretary-General Patrick Tay said the actual number of those retrenched in 2017 will be fewer than the high of about 19,500 in 2016. But he said there will still be pockets of layoffs due to disruption, reorganisation and consolidation, and called on employers to embrace digitalisation and technology, and to focus on "up-skilling, re-skilling and second-skilling all their employees".
He also urged workers to stay able, agile and adaptable - with skills that are in demand, be agile to move into, across and up into new jobs and be adaptable to the peaks and troughs caused by the wave of changes sweeping across all sectors and industries.
Foo See Yang of Kelly Services said most companies remain conservative in their hiring approach. As new players expand operations into the e-commerce market, the procurement, supply chain and logistic sector is likely to face strong growth for the next three years, he noted.