Labour market tightens as demand for talent grows amid economic recovery.
SINGAPORE: Singapore’s labour market continues to tighten as companies ramp up hiring plans amid a recovering economy, according to a recent report by Nomura.
The report highlights a significant improvement in the Labour Market Conditions Indicator (LMCI) for the first quarter of 2024, signaling robust wage growth and high demand for talent. Average monthly earnings have surpassed pre-pandemic levels, reflecting increased business activity across sectors.
Rising Hiring Intentions
Data from the Ministry of Manpower (MOM) reveals that 50.7% of companies in Singapore plan to hire more workers in the upcoming quarter, up from 47.7% in the previous quarter. This uptick signals heightened business optimism and expansion strategies.
The job vacancies-to-unemployment ratio remains above 1%, at 1.6%, indicating that job openings continue to exceed job seekers. The total number of vacancies has risen for the second consecutive quarter, underscoring persistent demand for skilled workers.
Improving Job Market Stability
The retrenchment rate dropped from 3,460 in the last quarter of 2023 to 3,030 in Q1 2024, reflecting a stabilizing job market. Employment figures also improved, with 4,700 more individuals employed during the quarter. However, the unemployment rate saw a slight increase to 2.1% in March 2024, as the labour market adjusts.
Sustained Wage Growth and Inflation Pressure
Nomura analysts anticipate continued wage pressures as labour demand remains strong. This trend aligns with projections of elevated core inflation in the near term, driven by sustained wage growth and economic expansion.
The report paints an optimistic picture for Singapore’s labour market, with businesses gearing up for growth and economic recovery driving demand for talent.
