Unemployment Remains Low, but Business Restructuring Leads to Increased Job Losses
SINGAPORE — Employment in Singapore saw continued growth in the last quarter of the previous year, marking the fifth consecutive quarter of increases, according to the Ministry of Manpower (MOM) in its Labour Market Advance Release 2022, published on January 31. Additionally, unemployment levels remained low through December 2022.
However, the number of retrenchments has risen compared to the third quarter of 2022, although it remains “comparable to its pre-pandemic range,” MOM stated.
While the comprehensive labour market report will be released in mid-March, MOM provided some key highlights. “Throughout 2022, the labour market experienced significant improvement compared to 2021. The unemployment rate has returned to pre-pandemic levels, with increases in both total and resident employment,” MOM noted.
The ministry pointed out that most of the employment growth was driven by non-resident workers, particularly in the construction sector. Resident employment also saw an uptick in the last quarter of 2022, particularly in the Food & Beverage Services and Retail Trade sectors, boosted by year-end festivities.
MOM’s highlights indicated that the rise in retrenchments was largely due to business reorganizations and restructurings. “The increase was primarily driven by higher job losses in Information & Communications, Electronics Manufacturing, and Wholesale Trade, while other sectors saw stable retrenchment levels,” the report added.
In 2022, total employment grew by an unprecedented 231,700 following a significant decline during the pandemic, with non-residents leading this growth as travel restrictions were lifted. Resident employment also grew during 2022, albeit at a slower rate than the previous year.
Furthermore, “the annual average unemployment rates in 2022 were significantly lower than in 2021, with overall rates at 2.1% compared to 2.7%; resident rates at 2.9% versus 3.5%; and citizen rates at 3.0% compared to 3.7%,” MOM reported.
The ministry also noted that “hiring sentiment remains positive for the upcoming months” based on surveys conducted among businesses. However, uncertainties in the global economic landscape, rising inflation, and geopolitical tensions could impact the labour market.
“The anticipated slowdown in economic growth for 2023 may affect the momentum of improvements in the labour market. With the recent rise in retrenchments, unemployment rates could also trend higher.”
