SINGAPORE, March 14 — Singapore’s labour market recovery is likely to sustain in the coming year, but the Russia-Ukraine conflict could cloud the Republic’s employment situation, officials said on Monday (March 14). 

Speaking at a media briefing for the Ministry of Manpower’s (MOM) 2021 labour market report, Kenny Tan, divisional director of manpower planning and policy division at MOM, said the authorities are keeping a close eye on developments from Ukraine, which could lead to higher inflation through higher energy prices, for instance. 

“Inflation is a risk that my colleagues at the Ministry of Trade and Industry are concerned about, and that will affect business competitiveness and viability, and therefore there may be some knock-on effects on the labour market,” he said. 

Apart from inflation, Aubeck Kam, MOM permanent secretary added that authorities are also looking closely at supply disruptions as another factor. 

“If there is an impact to our economy, then there will be a corresponding impact on our labour market,” he said. 

MOM’s quarterly labour report showed that the pace of economic recovery is also expected to be more gradual in 2022 due to the “significant improvements” already experienced in 2021.

Barring the uncertainties from the Russia-Ukraine conflict, the labour market recovery “should be sustained in 2022 as business activities continue to pick up”. 

Domestically, the outlook on various sectors continues to be uneven. 

“Barring a sharp slowdown in the global economy, growth in the outward-oriented sectors is expected to remain positive,” said the report. 

Growth is expected to remain healthy in information and communications and financial and insurance services sectors, due to “robust demand for IT and digital solutions, and credit and payment processing services respectively” that should provide sustained labour demand in these sectors. 

Consumer-facing sectors, such as food and beverage services and retail trade, are also projected to benefit from the gradual easing of Covid-19 measures in Singapore, and more workers will be needed to support this pick up in business activities.

However, the recovery of the tourism and aviation-related sectors is expected to be slow on the account of the gradual loosening of travel restrictions globally, and the nascent recovery in global travel demand.

“Employment levels in these sectors may take longer to return to pre-Covid levels,” said the report. 

The report also showed that in 2021, total employment had increased, after a sharp contraction in 2020. 

Here are the employment indicators at a glance: 

Employment

The report also showed that in 2021: 

•           total employment in Singapore had increased by 41,400, after a sharp contraction of 166,600 in 2020. 

•           While non-resident employment fell by 30,000 in 2021, resident employment offset this decline, increasing by 71,300. 

The increase in employment was more significant in the information and communications, health and social services, professional services, administrative and support services, and financial services sectors.

On the other hand, resident employment fell moderately in accommodation, air transport and supporting services, and arts, entertainment and recreation sectors, “reflecting the effects of tight travel restrictions for the most part of the year”, the report said.

Among non-residents, the decline was mainly driven by Employment Pass and S Pass holders, whose numbers fell by 15,300 and 12,200 respectively, while Work Pass holders fell by a smaller extent of 2,400.

Non-resident employment declined in all sectors, except for Construction, which was boosted by the increase in the final quarter of the year as border restrictions progressively eased, the report said. 

Unemployment 

The annual average unemployment rates in 2021 were significantly lower than in 2020, as the unemployment situation “improved steadily throughout the year”. 

•           Unemployment rates fell from 3.0 per cent in 2020 to 2.7 per cent in 2021, resident unemployment fell from 4.1 per cent to 3.5 per cent, while citizen employment fell from 4.2 per cent to 3.7 per cent.

•           In January 2022, unemployment rates declined to around December 2019 levels, said the report. 

•           The annual average resident long-term unemployment rate in 2021 stood at 1.0 per cent, which was unchanged over the year and remained elevated compared to 2018 and 2019. This is because “structural mismatches tend to take longer to dissipate”, said the report. 

•           Nevertheless, business slack has “ameliorated significantly”, with retrenchments falling from a high of 26,110 in 2020 to 8,020 in 2021, below levels seen in pre-Covid years.

•           With the pick-up in business activities, there were also 1,200 employees placed on short work-week or temporary layoffs by the fourth quarter last year. The number remains above pre-pandemic levels, but is lower than in the third quarter where there were 4,060 employees who were placed on such arrangements.

The annual re-entry rate among retrenched residents rose from 62 per cent in 2020 to 66 per cent in 2021, which is a six-year high.

•           There was also broad-based improvements across age, education and occupation groups.

•           The seasonally adjusted recruitment rate also trended higher to 2.5 per cent in the fourth quarter of 2021, the highest rate since 2014.

•           The seasonally adjusted resignation rate held steady over the quarter at 1.7 per cent, slightly below the typical pre-Covid rate.

Job vacancies

In December 2021: 

•           The seasonally adjusted number of job vacancies rising further to 117,100

•           The ratio of job vacancies to unemployed persons also rose to 2.11 compared to 1.95 in September

The high number of job openings was driven in part by travel restrictions impacting the inflow of migrant workers, said the report. 

“However, with the gradual easing of these restrictions, we expect non-resident workforce numbers to improve in 2022, and job vacancies in sectors with heavier reliance on migrant workers to abate,” said the report.

Growth sectors such as information and communications, financial services, and professional services, continue to see robust resident employment growth and job vacancies also increased and remained high. — TODAY