SINGAPORE: In a release that unveils a complex and dynamic labour market, the Ministry of Manpower’s Labour Market Advance Release for the second quarter of 2023 reveals both hopeful and challenging aspects.
While the Singaporean economy witnesses the seventh consecutive quarter of total employment growth, it does so at a markedly slower pace. The document also reveals an ebb in retrenchment rates after three consecutive quarters of growth.
Slowing Growth Puts Employment Expansion in Spotlight
Total employment, which excludes Migrant Domestic Workers, grew by 23,700 in Q2 2023. This is the seventh consecutive quarter of expansion. However, the reduction in pace compared to prior quarters raises questions about the continued resilience of the labour market.
Interestingly, the growth in employment is led by non-resident workers in the construction sector, aligning with the sustained demand for private and public sector projects.
These workers, chiefly Work Permit Holders, typically found employment in lower-paying roles, calling attention to the continued segregation of employment opportunities.
On the other hand, resident employment dipped slightly in Q2 2023, primarily in the Food & Beverage Services and Retail Trade sectors. This contraction, though not unusual for the first half of the year, is a stark reminder of the employment volatility in these sectors.
In a reassuring contrast, sectors like Community, Social & Personal Services, Financial Services, and Professional Services saw continued resident employment growth. However, this growth has decelerated, which may be indicative of broader global economic uncertainties.
Stability Amid Fluctuation: Unemployment Rates Remain Steady
Despite the whirlwind of activity in the labour market, the unemployment rates in June 2023 remained stable – the overall rate at 1.9%, the resident rate at 2.7%, and the citizen rate at 2.8%. This statistic, despite fluctuations in April and May, offers a glimmer of hope in the stormy labour landscape.
Retrenchments Take a Dive, But Why?
In an optimistic turn, retrenchments fell from 3,820 in Q1 2023 to 3,200 in Q2 2023, reminiscent of the pre-pandemic levels.
While business reorganisation and restructuring were flagged as the primary causes of these retrenchments, it’s worth probing deeper into the implications of this decline.
Forecasting a Shaky Future
The Ministry’s release hints at a potential softening of labour market conditions in the coming quarters, mirroring the moderation in economic growth due to global economic turbulence. The guarded approach of firms towards hiring and wage increases could have significant implications for future employment trends.
Government programs aimed at business transformation and employee upskilling could be key tools for navigating the predicted slowdown.
Whether initiatives like the Career Conversion Programmes and the SGUnited Mid-Career Pathways Programme can truly offset the potential impact of the economic headwinds remains to be seen.
Equally, the potential of the newly launched CareersFinder beta feature on WSG’s MyCareersFuture job portal to aid jobseekers is yet to be tested.
However, the approach of using data-driven insights to guide job search and reskilling recommendations seems promising.
The Labour Market Report Second Quarter 2023, due for release in mid-September, is eagerly awaited to provide further insights into the state of the labour market and its future trajectory.