Unemployment rate rises for Singapore’s younger workers in Q2, despite holding steady overall
Total employment grows more, while job vacancies and retrenchments fall
[SINGAPORE] The unemployment rate of Singapore residents younger than 30 rose to 5.7 per cent in June, said the Ministry of Manpower’s (MOM) Labour Market Report on Wednesday (Sep 17).
This was even as Singapore’s overall unemployment rate stayed stable at 2 per cent, and both citizen and resident unemployment rates eased.
The citizen unemployment rate fell to 2.9 per cent in June, down from 3.1 per cent in March. For residents, it edged down to 2.8 per cent, from 2.9 per cent.
The young generally have higher unemployment rates because of “greater job search activities”, said Ang Boon Heng, director of MOM’s manpower research and statistics department, at a media briefing. “They move about more.”
In June, resident unemployment rates fell for all but two age groups: those under 30 and those aged 60 and above. For those under 30, the 5.7 per cent rate was above March’s 5.4 per cent, but still within the pre-recessionary range of 4.9 to 6.1 per cent.
For those above 60, the unemployment rate rose to 2.5 per cent, from 2.3 per cent in March.
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No prolonged difficulties
The latest data mirrors reports of fresh graduates having difficulties getting jobs, noted Ang.
Speaking to media at a company visit to CapitaLand, Minister for Manpower Tan See Leng noted that these difficulties are partially due to the increased pool of fresh graduate jobseekers.
He noted that, as at June 2025, about 2,400 fewer fresh graduates were pursuing further studies or taking gap years, compared to a year ago. This comes as the most recent graduates feel the pressure to work because of “angst” over the uncertain global economy, he added.
Even so, MOM’s Ang highlighted that 9,300 – or 51.9 per cent of the cohort – found jobs as at June. This was 700 more than a year earlier, when 8,600 graduates, or 47.9 per cent of the cohort, were employed.
A year after graduation, unemployment rates usually fall to about 6 per cent, in line with the rate for those aged 25 to 29, he added.
Nor is this under-30 group likely to stay unemployed for long. In June, their long-term unemployment rate improved to 1.1 per cent, from 1.2 per cent in March.
The overall long-term unemployment rate for residents held steady at 0.9 per cent in June.
Employment grows
MOM said that the labour market remained resilient in the second quarter, in line with the economy’s continued expansion.
Total employment, excluding migrant domestic workers, rose by 10,400 in Q2, improving from the first quarter’s muted 2,300 increase. This comprised an increase of 2,600 residents (up from 200 in Q1) and 7,800 non-residents (up from 2,000 in Q1).
Resident employment continued to rise in growth sectors such as health and social sciences.
But there were signs of labour market softening in outward-oriented sectors such as professional services as well as information and communications, which MOM attributed to macroeconomic uncertainty due to the evolving tariff situation.
Non-resident employment growth was mainly driven by work permit holders in roles such as construction labourers, and bus and truck drivers.
Employment growth was widespread across industries in Q2, with a reading of 56.2 on MOM’s Employment Diffusion Index (EDI).
A reading of 50 indicates a balance between industries where employment grows or contracts. When growth is concentrated in fewer industries than before, the EDI falls. Conversely, the EDI may rise with broader-based expansion, even if overall employment growth moderates.
The Q2 2025 figure lies between those for Q2 2023 (58.9) and Q2 2024 (54.4), despite a moderation in overall employment growth.
“The EDI suggests that underlying labour market conditions are stronger than headline figures alone might indicate,” MOM said.
Vacancies and retrenchments ease
Job vacancies had a broad-based decline but remained high, with 76,900 in June, down from 81,100 in March. But there were still more vacancies than jobseekers, with the ratio at 1.35.
Vacancies typically filled by residents remained robust in growth sectors.
Retrenchments remained low at 3,540 or 1.4 per 1,000 employees, decreasing slightly from 3,590 in Q1.
Retrenchments rose in information and communications, as well as financial and insurance services. But MOM noted that these sectors are “more dynamic in nature” and remain top hirers, based on vacancies.
Reorganisation or restructuring (67 per cent) remained the main reason for retrenchments. Fewer retrenchments were due to poor business or business failures (16 per cent), cost concerns (14.3 per cent), or a recession or downturn in the industry (5.4 per cent).
The resident re-entry rate into employment, within six months of retrenchment, dipped to 56.3 per cent from 60.6 per cent in Q1, led by non-professionals, managers, executives and technicians.
In a Facebook post, Yeo Wan Ling, National Trades Union Congress director for the U SME and U Women & Family units, warned of a continued need to keep a close watch on this decline, even as the overall labour market remained resilient.
For those retrenched 12 months ago, the re-entry rate was higher at 71.2 per cent, suggesting a longer job search.
Given the “pretty stable” vacancy numbers, this could be due to their preferences rather than a lack of available jobs, said MOM.
Looking ahead, uncertainty is expected to slow hiring and moderate wage growth, particularly in outward-oriented sectors, said MOM. Meanwhile, retrenchments “may rise modestly but remain low”.
“Overall, the labour market remains on a stable footing, though early signs of easing point to more selective growth in the months ahead,” the ministry said. It expects the EDI to fall, with a gradual shift from broad-based to more sector-driven employment growth.
Domestic industries may be “more stable”, while growth for outward-oriented ones could ease, said Dr Tan. But shifts will not be significant immediately, and the government is preparing for changes ahead, particularly from the last quarter. This is why the Graduate Industry Traineeships (Grit) programme will begin in October, he said.
But providing traineeships that run too long could lead to “cannibalising” workers’ job searches, he said. Grit is thus coupled with other initiatives such as career fairs, to provide “broad-based support”.
Dr Tan also pointed to the strength of private-public collaborations, noting the memorandum of understanding signed by CapitaLand and Workforce Singapore on Wednesday, to invest S$7 million to drive workforce transformation through artificial intelligence and workforce agility.
He said: “If, in the first quarter of 2026, things continue to worsen, we have drawer plans in place that we will activate to support Singaporeans.”
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