The number of people employed in Singapore grew by just 300 in the first quarter of the year.
This preliminary figure from the Ministry of Manpower (MOM) came as a surprise to many observers as, up to last year, the labour market had been humming along with an average of 31,670 more jobs filled each quarter for the past five years.
"Disconcerting", "startling" and "somewhat bewildering" are how some economists described the three-digit figure which greeted them two Saturdays ago.
Released a day after May Day, the number was the worst quarterly showing since the global financial crisis in 2009, when total employment in Singapore shrank for two consecutive quarters.
Is this 99 per cent drop in the number of additional jobs filled a statistical blip or does it point to something deeper and more worrying about the Singapore economy?
To be sure, most people think that employment growth is the same as job creation. It is not quite the same.
In layman terms, job creation is simply the number of jobs created by the economy, by employers from both the private and public sectors.
But in economic research, it is hard to tell if the economy is generating more jobs. One could survey thousands of businesses to ask them if they have created more jobs over the past three months but that data would be flawed as it would be based on estimates.
What is more accurate is to see if employers actually hired more or fewer people.
This is called employment growth and most government agencies, including MOM, take this indicator instead.
To arrive at this figure, MOM takes the employment level at the end of the quarter it is studying and compares it to the employment level at the end of the previous quarter.
So the reasons for the paltry growth of 300, a 99 per cent tumble from the last quarter of 2014, rest on two main factors - whether there was a net increase in the number of jobs as well as whether there were more workers to fill the positions.
Demand and supply
ON THE demand side, job losses were unlikely to have had a big impact as layoffs were not unusually high last quarter.
The figure was 11 per cent more than in the same period last year, but still 10 per cent lower than in the last quarter of 2014.
On the other hand, the first three months of the year are typically a slow period for hiring. The demand for workers eases as businesses take a breather from the frenzied festive period.
"Seasonal workers hired to meet the increased manpower demand for the year-end and Chinese New Year season leave employment at the end of the festivities in February," said MOM in its report.
Experts also point out that firms could have done more "frontloading hiring" in the fourth quarter of last year, with the expectation that global growth would pick up this year.
"They may have then realised that growth was not as good as expected, and did not need to hire more this quarter," said DBS economist Irvin Seah.
But the employment-growth figure is exceptionally low compared with the 28,300 in the first quarter of 2014 and the first-quarter average of 29,800 over the past five years.
Growth at the end of last year - 40,700 - is also not that much stronger than the fourth-quarter average of 38,700 over the five preceding years, so the frontloading effect is unlikely to have had a major role.
"The drop is far larger than what can be attributed to seasonal factors," said Bank of America Merrill Lynch economist Chua Hak Bin.
At the macro level, economic growth has slowed too.
The weak manufacturing sector, which contracted by 6,400 workers, and some consolidation in the financial services are other reasons economists suggested for the sharp fall in demand for workers.
On the supply side, the tight labour market looks set to get even tighter, and this could strangle employment growth in time to come.
Foreign-labour supply constraints will worsen come July 1, when the Dependency Ratio Ceiling for the services sector turns binding, meaning firms have to let go of current employees if they are over their sectoral quota, said Dr Chua.
They will need to turn to local workers, but these too are in short supply as Singapore is facing a slowdown in population growth.
The number of citizens in the working ages of 20 to 64 years has been falling and, according to the 2013 Population White Paper, the ratio of citizens entering the working ages to those exiting will hit 0.7 to 1 by 2030, down from 2 to 1 in 2012.
As Assistant Professor Walter Theseira of Nanyang Technological University said: "You can't employ workers who don't exist."
With all these ingredients brewing, it is likely that the factors converged to create the sudden and dramatic slowdown seen last quarter.
Should workers be worried?
WHEN there is a shortfall of workers, employers are likely to scale back on job openings.
The economy will become less competitive if it becomes untenable for companies to expand or set up here because there are not enough workers to do the work, and each worker is too expensive to hire.
"Ultimately this translates into higher national unemployment which would be a worry for workers," said Singapore Management University economist Hoon Hian Teck.
If firms are unable to pass productivity gains on to workers, wage growth may come to a standstill, a scenario Prime Minister Lee Hsien Loong warned about in his recent May Day message.
"Wages have been rising in the tight labour market, but this is not sustainable. If productivity continues to stagnate, after a while so will wages, which may even fall back," he said on April 30.
Wait and see
WHETHER the difficult business conditions persist long enough for this to occur remains to be seen.
Several economists have cautioned that last quarter's drastic drop in employment growth could be a statistical blip.
Demand for information technology services and for social sectors such as healthcare and education is likely to remain healthy over the next few years, said Credit Suisse economist Michael Wan.
Mr Wan and DBS' Mr Seah estimate a rebound to 25,000 to 30,000 net growth in jobs on average per quarter going forward, slightly under the 32,500 quarterly average last year.
Also worth noting is that the figures in the recent report are preliminary data - they may be revised upwards when the finalised numbers are reported in the Labour Market Report, scheduled to be released on June 15.
More data is needed to form a clearer picture. For example, vacancies data for the first quarter will be known only next month. Vacancies have been at record highs in the past year and hit 65,600 for seasonally adjusted vacancies as at December.
A high number of vacancies suggests that demand for Singapore's goods and services is still healthy. But if this dries up, it could indicate that the economy is slowing dramatically.
That would be bad news for businesses and workers alike.