S'pore job market expected to recover at slower pace in 2022

Singapore's labour market is expected to sustain its recovery this year as business activities continue to pick up, although the Russia-Ukraine conflict could muddy the waters by making the global economic outlook more uncertain.

The pace of recovery may be more gradual as last year had already seen a strong rebound, a report by the Ministry of Manpower (MOM) showed yesterday.

Domestically, the outlook is likely to be uneven across sectors.

Last year, total employment, excluding migrant domestic workers, rebounded by 41,400 after a sharp decline of 166,600 in 2020.

This was due to stronger resident employment growth, which rose by 71,300 and more than offset the non-resident employment decline of 30,000, MOM highlighted in its labour market report for last year.

In the fourth quarter alone, total employment went up substantially by 47,900 despite the outbreak of the Omicron variant of Covid-19.

Then, the number of non-resident workers employed grew for the first time in two years with the easing of curbs on the inflow of foreign labour.

MOM's data showed that the number of residents employed grew in sectors such as information and communications, health and social services, professional services and financial services.

However, resident employment fell moderately in accommodation, air transport and supporting services, and arts, entertainment and recreation due to tight travel curbs for the most part of last year.

Meanwhile, non-resident employment declined in all sectors except for construction, boosted by an increase in the fourth quarter with the easing of border curbs.

The number of Employment Pass holders fell by 15,300 and S Pass holders by 12,200. The number of work permit and other work pass holders declined by 2,400.

The unemployment situation also improved.

The overall rate fell to 2.7 per cent last year, from 3 per cent in 2020. The resident unemployment rate, which covers Singapore citizens and permanent residents, declined to 3.5 per cent, from 4.1 per cent previously.

Among citizens, this was 3.7 per cent, down from 4.2 per cent.

The unemployment rates in January this year were comparable with those seen in December 2019.

But the long-term unemployment rate among residents - which accounts for those unemployed for 25 weeks or more - remained elevated at 1 per cent, compared with the pre-pandemic level of 0.7 per cent.

This was due to "structural mismatches" that tend to take longer to be resolved, MOM explained.

Retrenchments fell from a high of 26,110 in 2020 to 8,020 last year, below pre-pandemic levels.

And a higher proportion of retrenched residents were able to secure employment. The re-entry rate among retrenched residents rose from 62 per cent in 2020 to 66 per cent last year - a six-year high.

At the same time, hiring and job vacancies have gone up.

This year, the outlook for various sectors will likely be uneven.

Outward-oriented sectors are expected to continue seeing growth.

Information and communications and financial and insurance services, in particular, can expect healthy growth, due to robust demand for IT and digital solutions, and credit and payment processing services, said MOM.

Consumer-facing sectors, such as food and beverage services and retail trade, are projected to benefit from the easing of measures as more workers will be needed for the pickup in business.

On the other hand, employment levels in tourism and aviation may take longer to return to pre-pandemic levels with the gradual loosening of travel restrictions.

National Trades Union Congress assistant secretary-general Patrick Tay said employers will need to brace themselves for a tight labour market by exploring ways to redesign jobs and encourage digitalisation. Workers, too, will need to embrace lifelong learning to stay relevant and resilient to changes, he added.