But MOM says better indicator of structural unemployment is long-term unemployment rate
The Singapore government has blamed the dip on re-entry rates of retrenched workers to their exposure to global economic headwinds.
The first quarter of 2024 saw the re-entry rate among retrenched workers decline slightly to 59.4%, down from 61.5% in the last quarter of 2023, according to the Ministry of Manpower (MOM).
Liang Eng Hwa, Singaporean Member of Parliament, asked the ministry on the potential reason behind this dip.
"The decline in re-entry rate was driven by residents retrenched from Information and Communications, Financial & Insurance Services and Professional Services," MOM said in response. "These sectors saw relatively higher retrenchments in 2023 and slightly lower re-entry rates due to their exposure to global economic headwinds."
The ministry added that some retrenched residents who have yet to find employment within six months might still be looking for a preferred role, undergoing training, or taking a break.
"Given that many of the retrenched workers from these sectors possess in-demand skills, we expect re-entry rates to improve over time," it said. "The re-entry rates of previous cohorts of retrenched workers usually rises to around 75% at the 12-month mark."
Structural unemployment in Singapore
According to MOM, a better indicator of structural unemployment is the long-term unemployment rate, which is associated with structural mismatches in skills.
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"This rate has remained low at 0.8% as at March 2024, within the range observed during non-recessionary periods," MOM said.
"At the same time, overall labour demand has remained strong. Resident employment growth was positive in 1Q 2024 and job vacancies continue to outnumber job seekers."
Addressing retrenchment
Meanwhile, MOM said it will be introducing a "support scheme" to help involuntarily laid-off employees bounce back into employment.
"We are close to finalising the scheme parameters, and more information will be announced later this year," it said.
Retrenched employees in Singapore receive career matching services and information kits from the Taskforce for Responsible Retrenchment and Employment Facilitation. There are also various reskilling programmes in Singapore to help employees transition into new jobs, according to MOM.