S'pore's labour market continues recovery in Q1

Singapore's labour market continued its recovery in the first quarter, with total employment growing for the first time since the Covid-19 pandemic hit early last year.

A report by the Ministry of Manpower (MOM) yesterday showed that total employment, excluding migrant domestic workers, rose by 12,200 in the first three months of the year, after four consecutive quarters of decline. This far surpassed the preliminary estimate of 4,800 released in April.

Resident hires continued to rise, outpacing the decline in non-resident employment, owing in part to restrictions on the inflow of foreign workers.

The increase was driven by the broad hiring of residents in the service sectors, such as information and communications, food and beverage, health and social services, and administrative and support services.

More retrenched residents also found jobs within six months, while job vacancies have risen to nearly match the unemployed population, said the report.

But the labour market is still not fully back to pre-pandemic conditions, cautioned MOM. Moreover, uncertainties in the economy and the recent tightening of Covid-19 measures during phase two (heightened alert) are expected to weigh on the pace of labour market recovery in the second quarter.

Manpower Minister Tan See Leng said Singapore's path to recovery "will not be a straight road", and may run into roadblocks.

"Recovery is also expected to be more uneven across sectors than earlier expected," he said, speaking to the media after visiting the Procter & Gamble Singapore Innovation Centre at Biopolis.

But unemployment rates continued to ease, after peaking last September at 3.5 per cent for the overall workforce, 4.9 per cent for citizens and 4.8 per cent for residents, a category that includes citizens and permanent residents.

In March, the rates dropped to 2.9 per cent overall, 4.2 per cent for citizens and 4 per cent for residents - still higher than pre-pandemic unemployment levels.

Retrenchments, however, fell for the second consecutive quarter to pre-pandemic levels, said MOM. The re-entry rate of retrenched residents into employment also rose for two consecutive quarters, to 66.2 per cent.

As business activity picked up, the number of workers placed on shorter work weeks or temporary layoffs declined, from 8,710 in the fourth quarter of last year to 4,020 in the first quarter of this year.

Meanwhile, the number of job vacancies rose to 68,400 in March, exceeding the last high of 65,500 in March 2015.

The ratio of job vacancies to unemployed individuals also improved to 0.96 - nearly one job vacancy for every unemployed person - in March. This is an increase from a ratio of 0.75 last December.

But foreign employment growth is likely to continue its decline, given ongoing border restrictions, which could lead to labour shortages in sectors like construction.

In a Facebook post, National Trades Union Congress assistant secretary-general Desmond Choo said certain sectors continue to face pressures because of tighter measures and are finding it hard to sustain manpower.

He urged businesses "to double down on transformation and strengthen efforts to build Covid-19 resilience within workplaces".

Associate Professor Lawrence Loh from the National University of Singapore Business School said Singapore is not out of the woods.

"Employment normally lags economic growth - given the restricted situation in the second quarter now, the decline in economic activity is likely to affect the job market in the next quarter and beyond," he said.