SINGAPORE - For the first time in 10 months, Singapore's resident and citizen unemployment rates saw a slight increase in July, rising 0.2 percentage point each, following tightened Covid-19 restrictions under phase two (heightened alert).
Figures from the Ministry of Manpower showed that the resident unemployment rate, which covers Singapore citizens and permanent residents, rose from 3.5 to 3.7 per cent, while unemployment among Singapore citizens rose from 3.7 to 3.9 per cent.
The overall unemployment rate in July was 2.8 per cent, up from 2.7 per cent in June.
This likely reflected "a dip in demand for manpower in affected sectors such as food and beverage (F&B) and retail trade", wrote Manpower Minister Tan See Leng in a Facebook post on Monday (Sept 6).
The phase two (heightened alert) period lasted from July 22 to Aug 18, when curbs were implemented to contain the then growing Covid-19 clusters linked to the Jurong Fishery Port. This resulted in measures such as the cessation of dining-in at all F&B establishments and the reduction of social gathering group sizes from a maximum of five people to two.
Said Mr Tan: "We will continue to monitor the unemployment rates closely. The Singapore Ministry of Manpower will also provide a more comprehensive update in our Labour Market Report later this month."
In his post, Mr Tan encouraged companies to "constantly pursue innovation and review their business operations to meet the changing needs of the economy" and job seekers to tap initiatives such as placements under the the SGUnited Jobs and Skills Package.
The package was introduced last May to provide job, traineeship and skills training opportunities for Singaporeans.
He added that as Singapore moves towards becoming a Covid-19 resilient nation, measures will be relaxed further as more sectors of the economy reopen.
"This will help boost manpower demand and allow our labour market to continue recovering," he said.
Analysts feel that the slight bump in the unemployment rate due to temporary measures to curb the spread of Covid-19 under phase two (heightened alert) was expected.
"Since then, the vaccination rates have reached targets and there is a phased reopening ahead, so I think it should not derail the economic recovery, or the continued healing of the domestic labour market in 2022," said Ms Selena Ling, chief economist and head of treasury research and strategy at OCBC Bank.
"With the Vaccinated Travel Lanes to Germany and Brunei and more to come, the aviation and hospitality sectors may have some upside in the coming months," added Ms Ling.
Maybank Kim Eng economist Chua Hak Bin also sees the rise in unemployment figures as reflecting a "temporary pause".
"Firms that had to downsize during the heightened measures will still need to provide some notice period to employees. The job market will likely recover with the recent reopening," said Dr Chua.
However, he cautioned that job market recovery "is not a straight line trajectory and may still face a bumpy and winding road ahead even with the economic reopening".
Job seekers can find out more about Workforce Singapore's (WSG) programmes and career advisory and matching services at the My Careers Future website, or call the WSG hotline on 6883-5885.