SINGAPORE - The labour market held steady in the first three months of this year, even as economic growth slowed.
Total employment continued to grow, while the overall unemployment rate remained at 2.2 per cent after accounting for seasonal variations.
Preliminary data released by the Ministry of Manpower (MOM) on Friday (April 26) also showed that the number of retrenchments was roughly the same as in the previous quarter.
There were 2,500 retrenchments in the first quarter of the year, almost similar to the 2,510 in the previous quarter. This was higher than the 2,320 in the first quarter of last year, which was a five-year low.
However, the seasonally adjusted unemployment rate for Singaporeans inched up slightly to 3.2 per cent in March, from 3.1 per cent in December. The rate for residents - Singaporeans and permanent residents - was unchanged at 3 per cent.
Economists said the higher unemployment rate for citizens is not significant enough to cause alarm for now.
“It’s hard to pinpoint the exact reason for it because the uptick is very gradual, but we should keep an eye on these numbers,” said DBS economist Irvin Seah.
OCBC economist Selena Ling said that businesses will probably hold on to workers going forward. “They have to balance the short-term cyclical slowdown against the medium-term picture of a tight domestic labour market and green shoots coming out of China, especially with the coming tightening of the foreign worker quota in the services sector,” she said.
Singapore's economic growth came in below expectations at 1.3 per cent in the first quarter of this year according to flash estimates, the weakest year-on-year quarterly growth since the global financial crisis.
Some aspects of the labour market typically lag behind the economic cycle, and in the first quarter, employment here grew by 12,000, excluding foreign domestic workers.
Although this was slower than the growth of 14,700 in the fourth quarter of last year - which the ministry said was supported by short-term hiring for year-end festivities - it was a faster pace than in the first quarter of 2018, when just 400 more people were employed.
In particular, the number of workers in construction increased slightly in the first quarter of this year, after 11 consecutive quarters - or nearly three years - of decline. The manufacturing sector continued to shed workers.
The ministry said in a statement that preliminary indicators suggest that the labour market is holding up.
"Amid signs of external economic headwinds and uncertainty in 2019, and as economic restructuring continues apace, MOM and Workforce Singapore will work closely with our tripartite partners to help Singaporeans secure good jobs through the Adapt and Grow initiative."
"We also encourage workers to tap support under the SkillsFuture initiative to upskill and reskill, so as to build career resilience and improve their career mobility."
National Trades Union Congress assistant secretary-general Patrick Tay said in a Facebook post on Friday that while retrenchment figures have eased, there will likely be quarterly fluctuations especially with United States-China trade tensions and several key political elections across the globe, which cause uncertainties.
"When analysing manpower figures... we cannot look at unemployment and retrenchment figures alone, as they may lull us into a false sense of security. We need to also pay attention and co-relate this with employment rate, labour productivity, long-term unemployment and workforce training participation rate," he said.
Some of these statistics will be released by MOM in June.
Mr Tay also called on workers and businesses to cultivate a mindset of adaptability to respond to economic transformation and an evolving workforce landscape.