It has been slightly more than a year since Singapore’s economy took a hit due to the pandemic. On 28 April 2021, the government released some good news – indicating the first improvement in employment rates since COVID-19 first hit.
Here’s a look at 4 job statistics from the Labour Market Advance Release 1Q 2021 that employers should note.
#1 Total Employment Grew After Four Consecutive Quarters of Decline
During 1Q 2021, Singapore’s total employment (excluding Foreign Domestic Workers) expanded by approximately 4,800. This marked the first time increase after four consecutive quarters of decline since COVID-19 hit in 1Q 2020.
“This suggests that employers are regaining confidence and have taken more local workers on board,” said outgoing Minister of Manpower Josephine Teo in a Facebook post following her visit to NTUC Learning Hub.
According to MOM, the services sector continued to lead the employment growth charge, adding 9,000 roles in 1Q 2021. Within it, the bulk of total employment growth came from the Information & Communications, Financial Services, and Professional Services.
Despite an overall increase in employment, sectors such as construction and manufacturing still faced a manpower crunch.
The construction sector saw a slight employment expansion (approx. 200 people) in Q1 2021, while employment in the manufacturing sector saw a decline (approx. 4,400 people in Q1 2021), but at a much slower pace.
#2 Singapore’s Unemployment Rates Are On a Gradual Decline
Since residential employment is on an uptick, unemployment naturally declined.
Unemployment peaked in September 2020, matching the rate last hit during the Global Financial Crisis in 2009, as 4.9% of citizens became unemployed. Since then, the overall unemployment rates have been on a gradual decline over the past two quarters. As at March 2021, citizen unemployment rate stands at 4.2%.
Despite an easing in the unemployment situation, Singapore’s unemployment rates are still some ways away from pre-pandemic levels.
#3 Retrenchments Expected To Decline To Pre-Pandemic Quarters
While unemployment rates are still far from pre-pandemic levels, the number of retrenchments is expected to decline to levels usually observed in non-crises years, such as 2018 or 2019.
Since its peak in September 2020, the number of retrenchments has also been on a steep decline and is expected to continue on its trajectory. Retrenchment rates currently stand at approximately 2,100 people in Q1 2021, with more than half from the service industry. This is close to or below rates seen in the past five years.
Even though retrenchments have fallen significantly since the beginning of the pandemic, there are still pockets of job displacements due to on-going restructuring and re-organisation in companies. In addition, some of these retrenchments may also be attributed to affected firms that lack foreign manpower due to on-going travel restrictions.
#4 More Employers Expressed An Intention To Increase Hiring
According to on-going polls conducted by MOM, business sentiment are more positive among companies. Nearly 3 in 4 companies polled in March 2021 had plans to hire while a decreasing minority had intention to reduce headcount.
From the graph above, the decision to reduce both salary and/or headcount among employers has been on a downward trend since peaking in June 2020. On the other hand, plans to expand has been on an upward trend from June 2020.
In addition to various government hiring support schemes that were introduced or enhanced during Budget 2020 and Budget 2021, business sentiment is also improving. The Singapore Business Federation (SBF) also recently reported that SMEs across all sectors in Singapore registered an improvement in business sentiment.
During Budget 2021, the Jobs Support Scheme (JSS) and Jobs Growth Incentive (JGI) were extended and enhanced. Simultaneously, the SGUnited Traineeship Programmes were also extended and enhanced. These would have had a contributing impact on the jobs market.
In PM Lee’s May Day Rally this year, he mentioned that many union leaders have reflected positive sentiments toward the JSS and they asked if the scheme (which will expire for Tier 1 and 2 sectors in September 2021) could be further extended.
While the business outlook is improving, any relapse because of COVID-19 could again be devastating for Singapore’s economy, businesses and her people. At the same time, the existing hiring support schemes, which will gradually expire, may also reduce hiring sentiments if the global economy does not recover.
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