Overall unemployment rate rose to 2.1 per cent in June after taking into account seasonal factors
The slowing economy has cast a pall over the labour market, with more people losing their jobs and companies having fewer job openings in the second quarter of this year compared with the first quarter.
For the first time in four years, there were also fewer vacancies than job seekers, according to the Ministry of Manpower’s figures released yesterday.
This means workers have to moderate their expectations of pay and job prospects and be prudent in spending, said DBS economist Irvin Seah.
“The writing is on the wall. We’ll continue to see a softening in the labour market because of further risks to growth,” he added.
The overall unemployment rate rose to 2.1 per cent in June this year after taking into account seasonal factors such as Chinese New Year and the school holidays.
The seasonally adjusted rate was 1.9 per cent in March.
For Singaporeans, unemployment rose to 3.1 per cent in June, from 2.6 per cent in March.
When citizens and permanent residents are combined, the rate climbed to 3 per cent from 2.7 per cent in the same period.
Job vacancies, which have been falling steadily since last year, hit 49,400 in June.
As a result, the ratio of job openings to jobless people fell below one for the first time since June 2012.
“It may be increasingly difficult to characterise the job market as tight,” said Citi economist Kit Wei Zheng, adding that wage growth could slow.
The ministry, in a separate statement, gave total employment growth in the first six months of this year, saying it picked up against the same period last year despite manufacturing continuing to shed workers.
But local employment dipped by 200 – far fewer than the 8,900 drop in the first half of last year.
The decline can be attributed to both structural and cyclical factors, said the ministry.
“Structurally, growth of the local working-age population is slowing, due to smaller cohorts of younger locals entering the workforce, and more ‘baby boomers’ retiring… local employment growth since 2015 has been further weighed down by cyclical weakness in the economy due to the subdued global economic conditions,” it said.
Meanwhile, a net 11,800 foreign employees were added in the first half of the year, excluding foreign domestic workers.
The bulk of them, or 9,300, were work permit holders, many of whom found work in the food and beverage as well as the administrative and support service industries.
This brought the total number of people working in Singapore to 3,673,400 in June.
National Trades Union Congress assistant secretary-general Cham Hui Fong said the way to ensure sustainable employment growth is to raise productivity by redesigning jobs or re-skilling.
Courses in compliance and regulatory areas, as well as IT and coding skills, were recommended by Mr Foo See Yang, vice-president and country general manager for recruiter Kelly Services Singapore.
There could also be a shortage of workers in sectors catering to domestic demand, such as community, social and personal services, and accommodation and food services, said the ministry.
“Businesses will need to press on with job redesign and restructuring to become more manpower-lean, as the Government continues to regulate foreign manpower inflow at a moderated pace,” it added.