The labour market grew for the seventh consecutive quarter in 2Q 2023 but continued to show signs of cooling labour demand.
According to the Ministry of Manpower’s (MOM) Labour Market Report for the year's second quarter, released on 14 September 2023, total employment expanded by 24,300 – lower than the 33,000 growth seen in 1Q 2023.
The increase was due to growth in non-resident employment, which expanded by 25,500, whereas resident employment contracted by 1,200.
More than half the increase in non-resident employment was due to hiring in the construction sector. MOM shared that this was due to the demand to fulfil housing projects backlog brought about by the pandemic.
Manpower Minister Tan See Leng, who was at Dyna-Mac for a tour of the facilities when the ministry issued the report, shared that the labour market has remained stable for the first half of 2023 despite the weak outlook.
“I am encouraged by the resilience of our businesses – as well as our workers – and our labour markets' steady recovery since the pandemic,” he said.
However, he noted that total employment growth has declined for the fifth consecutive quarter, and the ratio of job vacancies to unemployed persons is still significant – down to 1.94 from 2.28 in March 2023.
Mr Tan added: “Our businesses, our workers have to be prepared for the downside risks in the global economy going forward … it's essential for companies to press on the transformation to upskill their workforce for them to continue to remain resilient.
“Employers and workers can preemptively redesign jobs and acquire the necessary skill sets for jobs of the future.”
He added that the Government has career conversion programmes, whilst NTUC has its company training committees (CTC) to assist employers and employees with this transformation.
Meanwhile, NTUC Assistant Secretary-General Patrick Tay shared on Facebook that he foresees continued cyclical challenges facing sectors such as manufacturing, given the weakening global demand for goods such as consumer electronics and continued geopolitical uncertainties.
He added that although retrenchments have declined in 2Q 2023, retrenchment numbers look set to hit past 10,000 this year, which is similar to pre-pandemic times.
"To remain competitive and resilient amidst global economic slowdown and more uncertain business environment, tripartite partners need to double down our efforts in business and workforce transformation and utilise the full spectrum of funding provided by our tripartite partners including NTUC’s Company Training Committee Grant," he wrote.
Resident employment growth contracted despite robust increases in sectors such as community, social & personal services and financial & insurance services.
MOM shared that the growth was offset by contractions in the food & beverage and retail trade services due to outflow from the cessation of seasonal hiring.
Unemployment rates remained low by the end of 2Q 2023, with resident and citizen unemployment concluding at 1.9, 2.7, and 2.8 per cent, respectively.
Resident long-term unemployment rate remained low at 0.5 per cent in June 2023.
Retrenchments declined to 3,200 in 2Q 2023 from 3,820 in 1Q 2023.
This was after it had risen for three consecutive quarters.
Reorganisation or restructuring was cited as the main reason, accounting for 69.9 per cent of retrenchments.
Retrenchments were largely driven by restructuring in the information & communications sector, which cited high costs as the reason for the restructuring.
However, MOM noted that the likelihood of resident workers, retrenched from the information & communications sector, finding new jobs remained high compared to workers from other industries.
Job vacancies declined for the fifth consecutive quarter to 87,900 in June 2023, down from the peak of 126,000 in March 2022.
Growth sectors, including professional services, information & communications, and financial services, comprised over one-fifth of the available job vacancies in June 2023.