The Covid-19 pandemic has done enough damage in the past six months to wipe out Singapore’s economic gains since 2016. The government estimates the economy to shrink between 5% and 7% this year, a lowered forecast of –4 to –7% given earlier.
This gloomy prognosis spells bad news for a job market that is already under stress. Advance estimates from the Ministry of Manpower (MOM) showed that the unemployment rate climbed from 2.4% in March to 2.9% in June. MOM’s job situation report released on Aug 11 cautions that the “softness in the labour market is likely to persist, with weakness in hiring and pressure on companies to retrench”.
For one, market watchers believe that the impact of the economy on retrenchments takes time to be seen. What this means is that the impact of reduced levels of economic activity during the two-month circuit breaker in 2Q2020 will only show up in the job market’s performance in the second half of the year.
Furthermore, the blanket wage subsidy given under the Jobs Support Scheme – which is believed to have prevented retrenchments – will expire at the end of this month.
In response to media queries on whether the scheme will be extended, Manpower Minister Josephine Teo said on Aug 11 that the government is “looking actively at whether broad-based support continues to be needed”. Deputy Prime Minister Heng Swee Keat will address this question “quite soon”, added Teo.
According to Heng in a Facebook post on Aug 12, business and union leaders told him that they acknowledge the wage subsidies cannot go on indefinitely, and are asking for support in the coming months. “I assured them of our continued commitment to support our workers and companies. I have also been having intensive discussions with our agencies to review and evolve our schemes as the situation develops,” said Heng.
Meanwhile, the government is actively promoting the SGUnited Jobs and Skills package to create and flag hiring opportunities. Already, some 24,000 people have been placed as at end-July. These placements are part of the 92,000 openings created by the National Jobs Council as at end-July. These include roles under the SGUnited Jobs and skills programmes, the public sector and the private sector that have been advertised on the MyCareersFuture.sg government job portal.
Some 70% of these openings are for professionals, managers, executives and technicians (PMETs). Over half of these are roles with the public sector or opportunities such as traineeships — particularly for recent and new graduates — and attachments offered by private sector firms that are significantly funded by the government.
Job opportunities, meanwhile, are classified into long and short-term ones. Of the two, there have been more vacancies for short-term employment, particularly at the onset and height of the pandemic, to cope with the issues it brought. However, the need for these roles, which include safe distancing ambassadors and swabbers, will pass once the crisis abates.
To this end, Teo has urged individuals seeking employment to be open to opportunities they may not have considered previously. To aid job seekers with this, MOM will publish job situation reports weekly with coverage on job opportunities and sectors that are still hiring. It will also provide updates on retrenchments and cost-saving measures adopted by firms.
Maybank Kim Eng senior economist Chua Hak Bin says these updates will “help match displaced workers with openings and opportunities in growing sectors”. OCBC’s Selena Ling agrees that more information is always useful and will help manage market expectations.
Even so, UOB economist Barnabas Gan says a base of 10,000 job opportunities highlights the “ongoing need to restructure Singapore’s labour market, especially given the permanent job losses as a result of the Covid-19 pandemic, notably in the services sector”. He expects a shift towards jobs in sectors such as finance and insurance, and information and communications that are slated to expand in 2H2020.
The big question, of course, is if job seekers are of the right fit.
