Retrenchments down among citizens and unemployment rate stays stable

The number of retrenched Singapore citizens also fell between 2016 and 2018 after two consecutive years of increase. PHOTO: ST FILE

Much ink has been spilled on the issue of Singaporeans' job prospects compared with that of permanent residents (PRs) and foreigners. Yesterday, data released by the Manpower Ministry (MOM) provided more grist to the mill.

It showed that the citizen unemployment rate had in fact remained stable, averaging 3.1 per cent from 2010 to last year. This mirrored the resident trend.

The ministry's Occasional Paper on Singapore Citizens in the Labour Force also noted that the unemployment rate for Singapore citizens stood at 3.2 per cent in June last year, slightly higher than the 3.1 per cent for all residents.

But this was to be expected, said MOM, as "PRs typically have to demonstrate a high degree of employability before being granted permanent residency".

When broken down by age group, those under 30 had the highest rate of unemployment - 6.2 per cent. But they took only a median of one month to find a job, compared with two months for all unemployed citizens. Those aged 50 and older took longer - three months, even though they were less likely to be unemployed.

The numbers are not surprising to Singapore Management University (SMU) associate professor of law Eugene Tan, who observed that recent graduates tend to be more selective. "The pressure to seek employment is not pressing for them," he said, adding that internships and further studies are a popular option during the waiting period.

Singapore University of Social Sciences economist Walter Theseira said higher job mobility and the uptake of more casual and contract employment among younger workers also explained the higher unemployment figures for the sub-30 group.

"Internationally speaking, there is no evidence to suggest we have a problem with youth unemployment," he said, citing International Labour Organisation statistics that put the global youth unemployment rate at around 13 per cent.

He added that while the data indicated that employment is not a serious challenge for older PMETs (professionals, managers, executives and technicians), there is a need to understand whether they have enough job mobility and career advancement.

Institute of Policy Studies senior research fellow Christopher Gee said that while the median job search duration of one month is good news for those below 30, it would also be useful to find out their mean duration of unemployment.

"This will give some sense of whether there is a 'tail' of workers who might be unemployed for much longer than the median," he said.

Discouraged citizens - those no longer looking for work as they believe they will not succeed - fell in number to 6,700 last year, the lowest in 10 years. They now make up just 0.3 per cent of the citizen labour force.

The number of retrenched Singapore citizens also fell between 2016 and 2018 after two consecutive years of increase. This brings the incidence of retrenched citizens down to five per 1,000 citizen employees - lower than eight years ago.

SMU's Prof Tan attributes the low retrenchment rate to a lean workforce and more awareness of the social and individual impact of layoffs.

"More businesses have sought to re-deploy and re-train their workforce," he said. "Retrenchments are seen as a measure of last resort."

The issue of retrenchments came to the fore recently, when the Singapore Democratic Party (SDP) said in an online article that a rising proportion of Singaporean PMETs are being laid off.

In issuing its correction direction under the Protection from Online Falsehoods and Manipulation Act last month, MOM cited data from its Labour Market Survey to show a falling number of retrenched local PMETs between 2015 and 2018.

Yesterday, a hearing was held between the SDP and the Attorney-General's Chambers (AGC), to deal with what the AGC called deliberate mischaracterisations of its arguments by the party.

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A version of this article appeared in the print edition of The Straits Times on January 24, 2020, with the headline Retrenchments down among citizens and unemployment rate stays stable. Subscribe