The Manpower Research and Statistics Department at the Ministry of Manpower (MOM) released its labour market advanced release estimates for the fourth quarter of 2020 on 28 January 2021.
Overall, there has been broad improvements in the labour market for the period of the report. However, the labour market is still not back at pre-COVID conditions. Uncertainties in the economic environment will continue to weigh on the recovery of the labour market, said MOM.
Here are the main takeaways from the estimations in the preliminary report.
#1 Employment Of Residents (Singaporeans And PRs) Rebounded To Pre-COVID Levels
According to MOM’s estimates, the number of employed Singaporeans and PRs had returned to pre-COVID levels by the end of 2020. In the last quarter of the year, resident employment grew by 28,900, after increasing by 43,200 in the previous quarter. This was due to a pick-up in business activities after the circuit breaker in April and May.
As we can see in the chart below, by the end of 2020, Singapore actually recorded modest employment growth of 9,300.
Most of the increases in resident employment were in growth sectors such as infocommunications & technology, financial services and professional services. Employment of Singaporeans and PRs also grew in the services sector, primarily in public administration and education. The festive season saw a boost in employment in the F&B services and retail trade too.
Resident employment declined mostly in sectors hard-hit by COVID-19, such as accommodation, wholesale trade, and retail trade.
However, non-resident employment accounted for all the employment decline in 2020.
#2 Decline In Non-Resident Employment
In the same chart above, we can also see that non-resident employment comprised virtually all of the employment decline in 2020. In fact, non-resident employment continued to decline by 42,400 from October to December last year.
For the whole year, non-resident employment declined by around 16% or 181,500. This was more than the overall employment decline of 172,200 positions in 2020.
This decrease was broad-based across all sectors, said MOM. However, there were steeper contractions in employment in the manufacturing and construction sectors, largely due to fewer non-resident Work Permit holders in the workforce.
#3 Unemployment Rate In Dec 2020 Remains Higher Than Dec 2019
The preliminary data from MOM showed that the unemployment rate for residents was at 4.4% last December. This is down from 4.6% in the previous month, but is higher than the 3.2% in December 2019 before COVID-19.
Unemployment rate among residents in 2020 is at the highest over the past 10 years. However, it stayed below those during SARS in 2003 and the Global Financial Crisis in 2009, said MOM.
#4 Fewer Retrenchments In 2020 Than In Past Recessions
Retrenchments in every quarter of 2020 were higher than in 2019. For the whole of 2020, the total number of retrenchments is expected to reach 26,570. Retrenchments occurred mainly in the arts, entertainment and recreation sector, wholesale trade, and air transport services.
However, if taking into account the size of the workforce, the incidence of retrenchment in 2020 (which is 13 retrenched per 1,000 employees) remained significantly lower compared to past recessions, said MOM.
The number of retrenchments in the last quarter – which is 6,100 – is expected to be lower than the previous quarter of 9,120. This was the first decline after five quarters of consecutive increases in retrenchment.
MOM said it remains to be seen if the reduction in overall retrenchments will be sustained in 2021, as retrenchments are expected to rise in air transport services due to ongoing travel restrictions, and business transformation in other sectors may result in further displacements.
Continued Government Support To Accelerate Hiring Of Singaporeans
The Government has set aside $1 billion for the Jobs Growth Incentive (JGI) to encourage firms to accelerate the hiring of Singaporeans. According to MOM, over 50,000 local jobseekers were hired in the first month of the scheme’s implementation in September last year.
The JGI scheme ends in March 2021 and it remains to be seen if employment rates will continue on an upward trend this year, despite ongoing programmes such as the SGUnited Traineeships Programme and SGUnited Mid-Career Pathways Programme, as well as SGUnited Jobs and Skills Centres set up in all HDB towns to bring career matching and coaching services closer to jobseekers.
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