SINGAPORE (Jan 31): While the inching up of Singapore’s seasonally-adjusted unemployment rate by 0.2 percentage points to 2.3% in 2019 is “a concern”, Manpower Minister Josephine Teo believes there is not cause for alarm just yet.
For one, Teo notes that resident and citizen unemployment rates had hovered around 4-5% in the previous decade. “From that perspective,” Teo says, “the unemployment rates for 2019 are a concern but they are not alarming.”
According to preliminary figures released by the Ministry of Manpower (MOM) in its Labour Market Report on Thursday, Singapore’s annual average unemployment rate was higher than the 2.1% recorded in 2018.
The unemployment rate had held steady in the last quarter of 2019, after trending upwards earlier in the year.
Unemployment rates for Singapore citizens and residents both edged up 3 percentage points in 2019, to 3.3% and 3.2% respectively.
Despite the higher unemployment rates, several bright spots were seen in the labour market.
Excluding foreign domestic workers, total employment grew by 16,600 in the last quarter. While it is lower than the 21,700 recorded in the third quarter, it surpasses the 14,700 growth in 4Q 2018.
Overall, total employment grew by 55,200 in 2019. Of this, local employment rose by 26,500, on par with the 27,400 recorded in 2018.
The growth came primarily from the construction sector, which picked up after cuts in the preceding three years.
Growth in services was consistent with 2018, while the manufacturing sector continued to see cutbacks, in line with declining exports.
Meanwhile, retrenchments for the last quarter hit 2,700 – slightly higher than the 2,470 jobs shed in 3Q 2019 and 2,510 from 4Q 2018.
For the full year in 2019, the total number of retrenchments hit 10,700, similar to a year ago, with the manufacturing and services sectors shedding the most workers.
Teo points out that the “better than expected” employment growth in 2019 and an absence of a spike in retrenchments suggests that “the challenge is not primarily the lack of job creation or jobs being created, but possible job-skills mismatches”.
Income
Despite labour market fluctuations, real median income of Singaporeans employed full-time has risen, notes MOM. Income levels increased 3.9% annually between 2014 and 2019, significantly higher than the 2.1% annual growth in the five years prior.
Specifically, real income growth at the 20th percentile rose by 4.6% annually, higher than the 3.9% annual growth at the median.
“This was helped by initiatives to raise the income of low-wage workers in recent years. As a result, their income gap with the median worker narrowed,” MOM says.
