Singapore’s job vacancies, unemployment up in Q1, with US tariff impact yet to be seen: MOM
The effect of the levies on the labour market is likely to show up in Q2 or Q3, adds ministry official
[SINGAPORE] Both job vacancies and unemployment rose in the first quarter of 2025, causing the ratio between them to stay unchanged, the Ministry of Manpower’s (MOM) Labour Market Report indicated on Friday (Jun 27).
Resident and non-resident employment grew more slowly than in the previous quarter, said the report, in an update to the Apr 28 advance release.
But MOM noted that Q1’s rise in job vacancies had yet to reflect the impact of US President Donald Trump’s tariff announcement on Apr 2. In polls conducted after the announcement, firms “remained measured in their outlook for manpower planning”, added MOM.
Manpower Minister Tan See Leng said in a media briefing that the slight rise in the unemployment rate suggests that employers were remaining cautious in hiring amid heightened global uncertainty. “We expect this caution to continue and hiring demand to moderate further, especially with the impact of the US ‘Liberation Day’ tariffs,” he added.
But he reassured Singaporeans that there are “still good job opportunities available”, especially in growth sectors. The government will continue monitoring the tariff situation, and – with other members of the Singapore Economic Resilience Taskforce – is reviewing further measures to help businesses and workers navigate the uncertainties, he pointed out. The government is also working with institutes of higher learning to increase access to job opportunities for fresh graduates, he said.
Slower employment growth
In Q1, resident employment edged up by 300, and non-resident employment rose by 2,000 – in contrast to increases of 1,400 and 6,300, respectively, in the fourth quarter.
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The rise in non-resident employment was driven by work permit holders, mainly in jobs such as driving buses or trucks, “which residents were less likely to take up”, said MOM.
Total employment growth eased to 2,400, down from 7,700 in Q4, with MOM noting that figures may not add up due to rounding.
The fall is due to both seasonal and structural factors, said Ang Boon Heng, director of MOM’s manpower research and statistics department. Singapore should not expect “very large” increases in employment, as its labour force participation rate is already high, he added.
Wait and see
Any impact from President Trump’s tariffs will likely show up in the second quarter or the third quarter, “depending on how the situation evolves”, said Ang.
As the labour market typically responds with a lag, firms are “waiting for greater clarity” before making adjustments to their workforce, he explained.
He expects “a slight softening” of the labour market – especially for trade-reliant sectors, as firms stay cautious – but not a “big correction”, as business sentiments have held steady so far.
Maybank analyst Brian Lee expects employment growth to slow in the second half, amid softer hiring intentions in Q3. Still, he noted the improving global economic outlook from the de-escalation of trade tensions and the possibility of Singapore’s government rolling out support measures for employers and workers in Q3 – in addition to an SG60 package.
Against this backdrop, Lee does not expect deep workforce cuts in Singapore. Nevertheless, he pointed out that sectors will likely be heterogeneous, with consumer-facing sectors experiencing ongoing weakness that could weigh on their employment outlook. Firms in manufacturing and trade-related sectors could also be more cautious in hiring, he said, as they face an export slowdown in the second half as a result of payback from Q2 front-loading.
Labour market still tight
There were 81,100 job vacancies in March, up from 77,500 in December 2024. But as unemployment also rose, job vacancies per unemployed persons held steady at 1.64, with MOM describing this as the labour market staying tight. The increase in job vacancies was broad-based across sectors, but MOM noted signs of slowing demand in manufacturing: 8,000 vacancies in March, down from 8,200 in December.
Vacancies “likely to be filled by residents” rose to 59,400 from 53,800 before, continuing to account for about 70 per cent of all vacancies. These were concentrated in growth sectors such as health and social services, professional services, information and communications, and financial and insurance services.
Unemployment rates as at March were higher across the board: 2 per cent overall, up from 1.9 per cent; 2.9 per cent for residents, up from 2.8 per cent; and 3.1 per cent for citizens, up from 2.9 per cent.
The resident long-term unemployment rate edged up to 0.9 per cent, from 0.8 per cent before, but was comparable to non-recessionary norms, according to MOM. But resident and citizen unemployment rates improved marginally in April, edging down to 2.8 per cent for residents and 3 per cent for citizens.
No deep cuts yet
In Q1, retrenchments declined slightly to 3,590 – higher than the advance release’s estimate of 3,300 – from 3,680 in the preceding quarter. This was driven mainly by fewer retrenchments in wholesale trade, as well as community, social and personal services. Retrenchments rose in sectors such as manufacturing, construction, as well as transportation and storage.
The incidence of retrenchment remained unchanged at 1.5 retrenched for every 1,000 employees, which MOM described as “well within non-recessionary norms”. Retrenched residents also got back into jobs more quickly. The resident re-entry rate into employment within six months of retrenchment improved to 60.6 per cent, from 58.1 per cent in Q4. Fewer employees were placed on short work-week or temporary layoff: 570, down from 660 in Q4.
“Together, these suggest that while firms are exercising caution in hiring, they are also holding back from deeper workforce cuts, reflecting a measured approach in workforce management amid ongoing economic uncertainty,” said MOM. However, while Singapore’s external demand outlook has “improved slightly” with the de-escalation of global trade tensions, “the near-term global economic outlook remains uncertain”.
Polls in April and May found a modest rise in hiring intentions, with 42.2 per cent of firms planning to hire in Q3. This was marginally higher than the 40.5 per cent of firms which, when polled between January and March, said they were planning to hire in Q2. But this was driven by only a few sectors, including professional services and financial services; hiring sentiments softened in most other sectors.
Wage expectations remained stable, with 21.2 per cent of firms indicating plans to raise wages in Q3. This was comparable to 21.7 per cent of firms planning to raise wages in Q2, in the last survey.
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