Singapore’s employment growth up in Q2, despite seasonal dip in resident employment
Total employment – excluding migrant domestic workers – grows by 11,300 during the quarter
SINGAPORE’S employment levels expanded more in the second quarter than in Q1, despite a slight seasonal decline in overall resident employment, advance data from the Ministry of Manpower (MOM) showed on Wednesday (Jul 31). Non-resident employment turned around from the previous quarter’s fall.
Total employment – excluding migrant domestic workers – grew by 11,300 in Q2 2024, more than double the increase of 4,700 charted in Q1.
The ministry said: “We expect labour market momentum to be sustained, with wages and employment continuing to grow in tandem, with an expected gradual pickup in Singapore’s economy.
“However, with slowing resident workforce growth and low resident unemployment rates, continued growth in resident employment is likely to become more muted.”
In Q2, while resident employment continued to rise in growth sectors – such as financial services, health and social services, information and communications, as well as professional services – it shrank slightly overall, dragged by retail trade.
Employers temporarily hire more workers in the fourth quarter of each year in preparation for year-end festivities, MOM noted, adding that resident employment typically dips or posts smaller increases in Q2.
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In contrast, after declining in Q1 for the first time since Q3 2021, non-resident employment increased and accounted for all the employment growth in the most recent quarter. This rebound suggested continued demand for labour in the economy, MOM said.
Non-resident employment growth was driven mainly by work-permit holders working in non-professional, managerial, executive and technical roles in construction and manufacturing.
The pickup in the construction sector was a reflection of firms adapting to the change in the dependency ratio ceiling from 1:7 to 1:5, MOM said. This ratio ceiling specifies the maximum number of S Pass and work-permit holders a company can employ as a proportion of its total workforce. The change kicked in on Jan 1.
While employment among both employment pass and S Pass holders fell in Q2, work pass applications for higher-skilled non-residents rose, MOM reported.
Employment grew for both residents and non-residents in H1 2024.
The unemployment situation eased, with the unemployment rate falling across the board in June. The overall rate slipped to 2 per cent, from 2.1 per cent in the preceding month. It was down to 2.7 per cent for residents, from 2.9 per cent before. Among citizens, it fell to 2.8 per cent, from 3 per cent.
Retrenchment numbers were generally steady. It stood at 3,100 in Q2, up slightly from Q1’s 3,030. Retrenchment levels were broadly stable in most sectors, with business reorganisation or restructuring remaining the top reason in the quarter.
Based on forward-looking data from polls, firms’ hiring and wage expectations were similar to the previous quarter.
In June, 49.4 per cent of firms polled said they would or may hire in the next three months, marginally lower than 50.6 per cent in March. As for salaries, 28.6 per cent reported in June plans to raise wages in the next three months, up from 26.1 per cent in March.
With these sentiments holding steady, there is still room for further development and expansion of the labour market, said National Trades Union Congress assistant secretary-general Desmond Choo.
“However, the fact that non-resident employment growth accounted for all the increase in total employment in the second quarter this year, coupled with our low resident unemployment rate, suggests we might be approaching structural limits within our resident workforce.”
Figures for resident and non-resident employment will next be released in mid-September, alongside other indicators such as job vacancies.
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