Singapore sees more retrenchments in third quarter as job vacancies continued to drop

SINGAPORE – The strains in Singapore’s job market showed in data released on Dec 11, with retrenchments climbing in the third quarter of 2025 after dipping in the previous two quarters, while job vacancies continued to drop.

The number of retrenchments stood at 3,670, up from 3,540 in the previous quarter, according to the Ministry of Manpower’s (MOM) third-quarter labour report.

The percentage of firms planning redundancies also rose, from 1.9 per cent in June to 2.3 per cent in September, the report showed.

MOM said the rate of retrenchment – 1.6 per 1,000 employees – and the number of retrenchments (3,670) “remained low”.

More employees were also placed on a short work-week or temporary layoff – 800 in the third quarter, from 620 in the second quarter – as employers tried to avoid retrenchments.

The increase in those on a short work-week was primarily seen in the manufacturing sector, with non-PMETs (professionals, managers, executives and technicians) making up about 66.7 per cent of it.

As bosses are more likely to shorten their hours during times of business slack, this often affects non-PMETs, as they are more likely to be hourly-rated employees, MOM said.

The retrenchments, meanwhile, were concentrated in growth sectors such as financial services, professional services, and information and communications.

Residents – citizens and permanent residents – accounted for 74.2 per cent, or 2,720, of those retrenched in the July to September quarter.

There were 69,200 job openings in September, down from 76,900 in June, according to MOM. This was higher than the 63,400 job vacancies in September 2024. 

But MOM noted that the average monthly recruitment rate stood at 1.8 per cent in the third quarter, and has “consistently exceeded” the average monthly resignation rate of 1.2 per cent post-pandemic.

The ministry added that since late 2022, both recruitment and resignation rates have been trending down, and are now lower than their 10-year averages of 2.1 per cent and 1.6 per cent, respectively.

“This suggests that firms are managing headcount through natural attrition rather than actively laying off workers. Employees, who are perceiving fewer opportunities, are also switching jobs less frequently. The result is lower labour mobility,” said MOM.

Even as overall vacancies moderated – driven by lower rates of resignations and terminations, and slower hiring – the ministry noted that “pockets of tightness persist”, particularly in PME roles across sectors such as information and communications, as well as health and social services.

Against the falling job vacancies, there were fewer job seekers, resulting in a rise in the ratio of job vacancies to unemployed persons. There were 1.49 job vacancies for every unemployed person in September, compared with 1.35 in June.

Total employment grew by 25,100 in the July to September period, more than double the 10,400 increase in the April to June period.

Singapore has enjoyed 16 consecutive quarters of employment growth that peaked at 124,400 in March 2022. The pace of growth when viewed longer-term has been declining.

Growth in resident employment was led by the financial and insurance services and health and social services sectors. Meanwhile, foreign employment’s growth was most pronounced in the construction and manufacturing sector.

MOM noted that outward-oriented firms continue to show relatively stronger hiring intent, although they are less likely than domestic-oriented firms to raise wages.

Post-retrenchment, the proportion of residents who found jobs within six months of being laid off continued to fall in the third quarter to 55.4 per cent – from 56.3 per cent in the second quarter.

The resident long-term unemployment rate remained steady at 0.9 per cent in September, and remained unchanged from the past quarters in 2025.

“Although economic uncertainties have receded since the first half of 2025, they remain elevated and will continue to weigh on firms, pointing to a moderation of labour demand,” said MOM.

To avoid retrenching full-time employees, organisations are increasingly turning to contract, part-time and flexible talent to manage costs, said a spokesperson for Jobstreet by SEEK.

“Rather than resorting to layoffs, companies operating across different markets can also consider shifting workloads between regions, adjusting job scopes accordingly to optimise manpower and maintain productivity,” said the spokesperson.

Mr Foo See Yang, managing director and strategic business group head of recruitment firm Persol Singapore, said “deeper structural shifts” are reshaping sectors such as finance, technology and professional services, leading to longer job searches.

Some displaced workers are coming from roles that are now being automated, consolidated, or relocated to lower-cost hubs, he noted. Meanwhile, new openings are emerging in areas like artificial intelligence, data, sustainability and healthcare.

Employers are also striking a balance between permanent headcount and contract or gig arrangements, especially in technology, supply chain and customer-facing roles, he added. “This offers organisations flexibility but can make it more challenging for retrenched workers to secure a comparable permanent role quickly, particularly if their expectations around salary, flexibility or scope remain tied to their previous position.”