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Update: Total employment in Singapore contracted in Q3, second time since 2008/09 recession
TOTAL employment in Singapore contracted in the third quarter of 2016, after slower growth in the previous two quarters. This is the second time total employment has contracted since the 2008/2009 recession.
According to the Manpower Research and Statistics Department's Labour Market Advance Release Third Quarter 2016 report, total employment contracted by 3,300 in the third quarter. This compares to the growth of 4,200 in the second quarter of 2016, and 12,600 a year ago.
"This is primarily due to contractions in construction and manufacturing, affecting mainly work permit holders,'' the manpower ministry said on Thursday.
There was a broad-based slowdown in employment growth in the third quarter.
Employment growth in services slowed to 5,700 from 7,600 in the previous quarter. Employment in manufacturing continued to decline by 3,700 for the eighth consecutive quarter, compared to a decline of 3,400 in the previous quarter as business outlook for the sector remained unchanged.
It also turned negative in the construction sector, falling 5,200 after four quarters of moderated increases.
"This occurred amid declines in private sector construction activities,'' the ministry explained.
In September, total employment reached 3.67 million, 0.8 per cent higher than a year ago, but lower than the 1.3 per cent growth in June 2016 and the average growth of about 2.0 per cent in 2015.
Based on the preliminary estimates, some 4,100 workers were made redundant in the third quarter of 2016, down from the 4,800 in the previous quarter. However, the number of redundancies was higher than the 3,460 a year ago, amid subdued global economic conditions and internal economic restructuring.
Services continued to form the bulk of redundancies at 59 per cent in the third quarter of 2016, followed by manufacturing at 27 per cent and construction at 15 per cent.
Selena Ling, Head of Treasury Research and Strategy at OCBC Bank expects Singapore's domestic labour market to see "further consolidation going into 4Q16 and 2017".
"With external headwinds and a sluggish domestic business conditions, hiring intentions and wage growth expectations will have to adjust accordingly,'' said Ms Ling. "Skills upgrading and reskilling efforts, as well as jobs-skills matching initiatives, will play an increasing role ahead to support the softening labour market."