Singapore labour market looks better, for now

The Singapore labour market improved slightly in the first half of 2017, with resident unemployment and long-term unemployment declining. There were fewer retrenchments and more job vacancies, the Ministry of Manpower announced in a statement.

• Resident unemployment declined from 3.2% in March to 3.1% in June even though it was still higher than the 3.0% a year ago.
• Long-term unemployment declined from 0.8% in March to 0.7% in June.
• Conversely, local employment grew: There were 4,000 new local jobs in the first half compared to the 8,900 drop in 1H2015 and the 200 decline last year. Growth was observed in the community, social & personal services, finance & insurance services and information & communication sectors.
• Foreign employment declined due to a decrease of 18,000 work permit holders in sectors such as marine and offshore engineering and construction.
• There were fewer retrenchments (7,640) in the first half, going from 9,510 in 2016.
• Labour productivity, as measured by real value-added per worker, rose by 2.8% in 1H2017. Growth was driven by the manufacturing, transportation & storage, wholesale & retail trade, other services and business services sectors
• Meanwhile, productivity declined in the accommodation & food services, construction, finance & insurance and information & communications sectors.

Following, too, are developments per sector:

• Manufacturing. Employment fell by 8,000 in 1H 2017 due to a decrease in work permit holders in the marine & offshore engineering segment, as the segment continued to be weighed down by sluggish demand for oil rigs and oilfield & gasfield equipment amid sustained low oil prices. Nonetheless, productivity in the sector rose 12.1%.
• Construction. Employment declined by 23,100 in 1H 2017 amid weakness in both private sector and public sector construction activities, with the decrease mainly from work permit holders. Output for the second half is expected to remain lackluster.
• Services. The sector saw employment growth in 1H 2017. Total employment (excluding FDW) in the Services sector grew by 13,700 in 1H 2017. Employment declined in sectors such as wholesale & retail trade, on the back of an uneven performance in the various sub-segments of the sector. Still, the declines were more than offset by employment gains in the community, social and personal services, transportation & storage, and information & communications sectors.

With the global economic recovery expected to continue in 2H 2017, employment growth is likely to be supported by outward-oriented Services sectors such as finance & insurance and transportation & storage. At the same time, employment growth in the domestically-oriented services sectors is expected to remain stable.

Specifically, sectors such as the community, social & personal services, particularly the health & social services segment, should continue to see increases in hiring.