SINGAPORE: Singapore’s labour market held steady in 2019, although unemployment rates edged up, according to a Ministry of Manpower (MOM) report released on Thursday (Mar 12).
Total employment growth in 2019, excluding foreign domestic workers, was the highest in five years, reflecting growth in both foreign and local employment.
But annual average unemployment rates were higher than a year ago for both citizens and residents, and the ratio of job vacancies to unemployed people declined.
“Given the continued increase in employment, this suggests possible mismatches in the labour market that bear closer monitoring,” said MOM.
Labour market trends for the fourth quarter of the year were mixed, with total employment growing at a slower pace and the long-term unemployment rate as well as retrenchments inching up.
In 2019, the annual average overall unemployment rate rose to 2.3 per cent from 2.1 per cent in 2018, holding steady in the last quarter of the year after trending upwards in previous quarters.
Unemployment for residents increased to 3.1 per cent last year from 2.9 per cent the previous year, while that for Singaporeans stood at 3.3 per cent, up from 3 per cent in 2018.
The annual average resident long-term unemployment rate in 2019 was unchanged from 2018 at 0.7 per cent, but trends were mixed across age and education groups, with residents at both ends of the age spectrum and those with non-tertiary qualifications seeing a rise in long-term unemployment rate.
FOREIGN EMPLOYMENT GROWTH MORE THAN DOUBLES
Total employment – excluding foreign domestic workers – grew by 57,000 in 2019, the largest increase in the past five years according to MOM.
This reflected continued growth in local employment and foreigner increases in the construction sector, said MOM.
The majority of the increase in employment was in the community, social and personal services, professional services, financial and insurance services and information and communications services sectors.
Foreign employment – excluding foreign domestic workers – grew by 28,700, more than double the 10,900 growth in 2018. This was largely driven by the construction (13,900) and services (15,100) sectors.
Employment growth among locals came in at 28,300, slightly lower than for foreigners and marking a small increase from the growth of 27,400 in 2018.
Local growth was boosted mainly by hiring in the services sector, including community, social and personal services, professional services, financial and insurance services and information and communications.
Overall, retrenchments remained low in 2019, coming in at 10,690 and similar to the 10,730 retrenchments in 2018. The services sector continued to account for most retrenchments (7,000), mainly in wholesale trade, professional services and financial services.
However, the end of the year saw a slight uptick, with the number of people laid off in the fourth quarter of last year – 2,670 – slightly higher compared to the previous quarter as well as a year ago.
Business restructuring and reorganisation accounted for the bulk of retrenchments in the fourth quarter, as they did for the year as a whole.
As for job vacancies, there were fewer vacancies in December last year compared to a year ago, as employers exercised greater caution in hiring due to the uncertain business environment.
The seasonally adjusted ratio of job vacancies to unemployed people was unchanged in December (at 0.84) compared to September, as both the number of unemployed people as well as vacancies for the whole economy declined.
OUTLOOK FOR LABOUR MARKET SUBDUED
The outlook for the labour market is expected to be subdued, said MOM, given global economic uncertainties and the evolving COVID-19 outbreak.
Amid the coronavirus outbreak, Singapore has downgraded its GDP growth forecast for 2020 to between -0.5 per cent and 1.5 per cent, with growth expected to come in at around 0.5 per cent.
READ: Singapore cuts 2020 GDP forecast range to -0.5% to 1.5% due to COVID-19 outbreak
“As the overall economic growth is projected to moderate, the outlook for the labour market is expected to be subdued,” said MOM in a statement.
However, there are “pockets of relative strength” in the Singapore economy that will continue to provide job opportunities, it added, such as the construction sector and information and communications sector.
READ: Budget 2020: More support for transformation of workforce, including SkillsFuture top-ups
Beyond near-term uncertainties, MOM also cited the longer-term challenges of “keeping our workforce relevant”.
The ministry highlighted the various initiatives announced in Budget 2020 including the SkillsFuture Mid-Career Support Package and SkillsFuture Enterprise Credit as examples of support for workers and employers.