SINGAPORE: The Ministry of Manpower (MOM) published its Labour Market Report for the fourth quarter of 2023 on Thursday (Mar 14), showing that despite showing resilience throughout the year, the incidence of retrenchment grew to more than double the low figure observed in 2022.
MOM noted that for 2023, retrenchments were at 6.7 per 1,000 employees, whereas in 2022, they were at 3.1 per 1,000 employees. 2023’s incidence of retrenchment is now similar to pre-pandemic levels, as the average for 2015 to 2019 had been the same as in 2023.
Nevertheless, MOM characterised Singapore’s 2023 labour market as showing resilience in the face of global headwinds and the inflationary environment.
Last year, total employment grew by 88,400, though non-resident employment growth was primarily responsible for the upswing. Resident employment has remained high, and resident unemployment has remained low at 2.8 per cent.
MOM also pointed out that the demand for labour decreased as 2023 went on. The rate of employment growth and the number of job vacancies both showing a decline over the year.
The exception to this was noted in December 2023, when the number of job vacancies rose slightly following six successive quarters of decline. In that month, the ratio of job vacancies to unemployed individuals increased to 1.74 as the labour market remained moderately tight.
Retrenchments, as mentioned earlier, increased over the course of last year. The main reason for retrenchments last year is still business reorganisation or restructuring (58.6 per cent).
This is in large part to the effect of global economic headwinds on certain sectors including Wholesale Trade, Information and Communications Services, and Electronic Manufacturing.
However, by the fourth quarter of 2023, 61.5 per cent of retrenched workers had found jobs again, six months after having been retrenched, though the re-entry rate is lower than the previous quarter. But the resident long-term unemployment rate stayed low, at 0.7 per cent, in December of last year.
“Looking ahead, MOM surveys indicate an improvement in business sentiments alongside MTI’s forecast of improved economic growth prospects for 2024. More employers have plans to hire or increase wages in 2024.
“With global headwinds persisting, we also expect business restructuring and reorganisation to continue, which may contribute to further retrenchments. The Government and tripartite partners encourage and support employers and workers to press on with business transformation and upskilling,” MOM said on Mar 14.
Read MOM’s latest Labour Marker report in full here. /TISG
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