SINGAPORE, June 15 — Singapore’s employment shrank for the first time in nearly six years in the January-March quarter, as jobs growth in the services sector fell sharply and manufacturers cut jobs.

Overall employment contracted by 6,100 in the first quarter, after rising by 40,700 jobs in the fourth quarter and increasing by 28,300 a year ago, the Ministry of Manpower said today.

It was the first quarterly contraction in employment since the second quarter of 2009. Singapore’s economy contracted that year, hit by the global financial crisis. The first quarter employment figure was revised down from an advance estimate of an increase of 300 jobs released in May.

“The contraction reflected seasonal declines and sharper moderation in employment growth in sectors with less favourable business conditions,” the ministry said.

Jobs growth in the services sector slowed to 4,300 in January-March from 40,100 in October-December. Jobs in the manufacturing sector fell by 6,900, falling for the second consecutive quarter.

It is hard to pin down the reason for the sudden drop in employment, said Irvin Seah, senior economist for DBS Bank.

The contraction may partly reflect a change in employers’ hiring behavior in the wake of the restrictions on hiring foreign workers that have been introduced over the past several years, he added.

“The last time we had a decline in the employment numbers was during the Lehman crisis, and historically.. .it will only dip into negative if the economy is entering a recessionary phase.”

“But having said that, in the past we didn’t have that much of a policy effect as we have today. The labor market dynamics have really changed significantly because of all the policy changes. So you can’t immediately pinpoint and say... this points to recession,” Sea said.

The seasonally adjusted jobless rate fell to 1.8 per cent in the first quarter from 1.9 per cent in the fourth quarter.

Seasonally adjusted job vacancies slipped to 65,300 from 65,500 but was up from 62,000 in January-March 2014, suggesting that demand for workers was higher compared with a year ago. — Reuters