Singapore’s employment growth speeds up in Q2, but sectoral softening to continue
Total employment rose by 8,400, driven by both resident and non-resident employment
[SINGAPORE] Employment growth sped up in the second quarter of 2025, driven by both resident and non-resident employment, with the Ministry of Manpower (MOM) describing the labour market as resilient.
But the pace remained slower than a year ago, with MOM noting continued signs of softening in some outward-oriented sectors.
DBS senior economist Chua Han Teng warned that labour market resilience may be tested in the second half of the year, as labour demand in trade-exposed sectors is likely to soften.
“Businesses will likely remain cautious about hiring and wage increases… as the US tariff roller coaster persists,” he said.
In Q2, total employment rose by 8,400, according to advance figures on Wednesday (Jul 30).
This was higher than the gains of 2,300 in Q1 and 7,700 in Q4 2024, but below the 11,300 rise in the year-ago quarter.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Resident employment kept rising in the health and social services sector, as well as financial services.
But it continued to fall in some outward-oriented sectors such as professional services as well as information and communications.
In a Facebook post, National Trades Union Congress assistant secretary-general Yeo Wan Ling said the trade union is “keeping a close watch” on sectors such as those two, “where resident employment is still softening”.
SEE ALSO
OCBC chief economist Selena Ling noted that employment in financial services may be holding up better as the sector benefits from lower interest rates, sustained capital inflows and the Singapore dollar’s perceived safe-haven status.
Separately, growth in non-resident employment was driven entirely by work permit holders, particularly in construction.
Unemployment, retrenchment stable
Unemployment rates fluctuated in the short term but stayed within non-recessionary levels. After a brief dip in April and May, both resident and citizen unemployment rose back to their March levels of 2.9 per cent and 3 per cent, respectively.
Retrenchments stayed stable at 3,500, comparable to 3,590 in the previous quarter. Most sectors saw similar or lower retrenchment levels.
The incidence of retrenchment also stayed low at 1.4 per 1,000 employees, with business reorganisation or restructuring remaining the main reason cited.
“Looking ahead, employment is expected to continue to grow, though at a more moderate pace than in 2024,” said MOM.
“Global economic uncertainty is expected to persist in the months ahead and may weigh on hiring and wage growth, particularly in outward-oriented sectors.”
Business sentiment remained relatively “stable but cautious”, noted MOM, with hiring and wage expectations for the third quarter dipping slightly from Q2.
In a business expectations poll conducted between April and June, 43.7 per cent of firms planned to hire in Q3, down marginally from 44 per cent in the previous quarter.
Similarly, the share of firms intending to raise wages fell to 22.4 per cent, from 24.4 per cent before.
Declining wage expectations were seen in outward-oriented sectors such as financial and insurance services, professional services, and transportation and storage.
Copyright SPH Media. All rights reserved.
