SINGAPORE - Hopes for a better 2021 are aplenty, but recovery for the labour market is likely to be protracted, experts say.
Although the latest quarterly labour market data released earlier this month shows the employment situation for Singapore residents is on the mend, uncertainties still abound.
Ms Selena Ling, OCBC Bank's head of treasury research and strategy, said it may take till 2022 for unemployment rates to return to pre-Covid-19 levels, barring a Covid-19 panacea.
"The biggest challenge is not really new per se - that there is a significant SME (small and medium-sized enterprise) base and older, low-income workers and even PMETs (professionals, managers, executives and technicians) who may find the pace of change accelerated and disruptive and have a more difficult time adapting and transforming," she said.
It remains to be seen how the labour market will react next year when the Jobs Support Scheme wage subsidies taper off and some of the traineeships, attachments and training programmes introduced to help job seekers end.
National Trades Union Congress secretary-general Ng Chee Meng said in a recent webinar organised by The Straits Times that the local and global health situation will be a big factor in determining how the economy recovers from its low base this year.
Some sectors are likely to stay muted, namely aviation and aerospace, engineering clusters that support those sectors, and hospitality and tourism. But healthcare, biotech and logistics should trend positively overall, he said.
The Covid-19 pandemic roiled the labour market this year, and the impact showed up in rising unemployment and retrenchments.
Also, the total number of people employed in Singapore dropped off a cliff in the April to June quarter, which coincided with the two-month circuit breaker period. Employment, excluding that of foreign domestic workers, fell by a record 103,800 in that quarter.
To mitigate the impact of the crisis on the job market, the Government rolled out aggressive job and training support schemes starting from the Budget in February.
These came in the form of wage subsidies under the Jobs Support Scheme and, later, the Jobs Growth Incentive, as well as through the SGUnited Jobs and Skills Package under which about 180,000 job openings, traineeships or attachments, and training places have been made available to job seekers.
By the third quarter of the year - the latest labour market data available - employment levels of Singaporeans and permanent residents had rebounded. There were 2.34 million residents working here in September, just 0.4 per cent shy of the 2.35 million in September last year.
Job vacancies also shot up in September for the first time all year, a sign that demand from employers could be on the mend.
However, retrenchments continued to climb in the third quarter.