SINGAPORE – Singapore’s labor market recovery is expected to continue this year as business activities continue to recover, although this could be affected by growing uncertainty in the global economic outlook amid the ongoing Russian-Ukrainian conflict. .
The pace of recovery could be more gradual as most significant improvements have already been made in the past year, the Ministry of Manpower (MOM) Labor Market Report 2021 showed on Monday (March 14). . Domestically, the outlook is expected to be uneven across sectors.
Last year, total employment, excluding migrant domestic workers, rebounded by 41,400 after a sharp contraction of 166,600 in 2020.
This was due to stronger employment growth for residents, which rose by 71,300 and more than offset a decline in non-resident employment of 30,000, the department pointed out in the report on Monday.
In the fourth quarter alone, total employment rose significantly by 47,900 despite the Omicron outbreak. The number of employed non-resident workers rose for the first time in two years with the gradual relaxation of Covid-19 borders on the influx of foreign labour.
MOM data showed that resident employment trends were mixed. While employment has increased in sectors such as information and communications, health and social services, professional services, administrative and support services, and financial services; it fell slightly in accommodation, air travel and support services, and in arts, entertainment and recreation due to strict travel restrictions for most of the year.
Meanwhile, non-resident employment fell in all sectors except construction, which was boosted by an increase in the fourth quarter as border restrictions eased.
This drop is due to the decrease in the number of Employment Pass holders by 15,300 and S Pass holders by 12,200. The number of work permit and other work permit holders also decreased, but in a lesser measure of 2,400.
The unemployment situation has also improved.
The overall rate fell to 2.7% last year, from 3% in 2020. The resident unemployment rate, which covers Singapore citizens and permanent residents, fell to 3.5%, from 4, 1% previously. Among citizens, this percentage was 3.7%, compared to 4.2%.
Unemployment rates in January this year were close to those seen in December 2019, the report said.
However, the average long-term unemployment rate among residents – which represents workers who have been unemployed for 25 weeks or more – remained high at 1%, compared to pre-Covid-19 levels of around 0, 7%.
This was due to “structural mismatches (which) tend to take longer to dissipate,” MOM explained.
Withdrawal and return to employment
On the pullback front, there has been a significant decline, from a high of 26,110 in 2020 to 8,020 last year, below pre-Covid-19 levels.
A higher proportion of laid-off residents were able to find employment. The annual reinstatement rate among laid-off residents fell from 62% in 2020 to 66% last year, a six-year high.
At the same time, hirings and vacancies have increased.
The seasonally adjusted hiring rate increased to 2.5% in the fourth quarter, a rate last seen in 2014. The quit rate also remained stable during the quarter at 1.7%, slightly below the rate typical before Covid-19.
Outgoing Manpower Permanent Secretary Aubeck Kam said: “We are not seeing any overall increase in quit rates. There are of course sectoral variants, but there is nothing to suggest that there is anything to worry about on this front.
Overall, the labor market remained tight, with the seasonally adjusted number of job vacancies rising further to 117,100 in December last year.
The high number of job vacancies is partly explained by travel restrictions which have an impact on the influx of migrant workers, the report points out.
However, with the gradual easing of these restrictions, MOM expects the number of non-resident workers to improve this year and vacancies in sectors that rely more on migrant workers to decline.
This year, the outlook for the various sectors will continue to be uneven.
Barring a sharp slowdown in the global economy, outward-looking sectors should continue to post positive growth.
Information and communication services and financial and insurance services, in particular, can expect healthy growth, driven by strong demand for IT and digital solutions, and credit and insurance processing services. payments, MOM said. “This should provide sustained labor demand in these sectors.”
Sectors in direct contact with consumers, such as food and beverage services and retail, should benefit from the relaxation of Covid-19 measures, as more workers will be needed for the resumption of commercial activities.
On the other hand, the recovery of tourism and aviation-related sectors is expected to be slow “due to the gradual easing of travel restrictions globally and the nascent recovery in global travel demand”, Mom said. “Employment levels in these sectors may take longer to return to pre-Covid-19 levels.”
Labor Minister Tan See Leng said he was “cautiously optimistic” that the labor market will maintain its recovery trajectory, despite heightened downside risks.
In a Facebook post on Monday, Dr Tan said providing targeted assistance to help businesses and workers remains a key priority for his ministry. “We will do more to elevate and strengthen support for vulnerable and mature workers,” he added.