‘Loyalty has become a liability’: Singaporeans react to rising retrenchments

SINGAPORE: Singaporeans already grappling with rising living costs and persistent inflationary pressures are voicing fresh anxieties over job security after new figures showed retrenchments have more than doubled in just three years.

Despite low unemployment and continued employment growth, the number of workers being retrenched has climbed sharply. Retrenchments rose from 6,440 in 2022 to 13,020 in 2024 before increasing further to 14,490 in 2025.

The trend has prompted concern among workers, particularly professionals, managers and executives (PMEs), as industries undergo restructuring, companies seek cost savings, and artificial intelligence begins reshaping workplaces.

The National Trades Union Congress (NTUC) said last week it has observed an increase in retrenchment cases linked to business restructuring and reported that more white-collar workers are turning to unions and trade associations for assistance after losing their jobs.

In 2025 alone, NTUC handled more than 3,900 retrenchment and termination-related cases involving PMEs, a 5% increase from the previous year. Some of the cases stemmed from companies relocating jobs overseas in response to cost pressures, NTUC assistant secretary-general and ruling party MP Patrick Tay told The Straits Times.

Revealing that some roles were being moved out of Singapore “even when local PMEs are experienced and capable,” he added, “We are also seeing businesses cite investments in AI as a factor for workforce restructuring. Some workers find themselves displaced because job roles are changing faster than they can adapt.”

The labour movement is particularly concerned about workers in professional services, finance, and the infocomm and technology sectors, which are viewed as among the industries most exposed to the impact of generative AI.

Sharing that many PMEs remain unaware they can join unions and seek representation from the labour movement during retrenchments, the MP told the national broadsheet about one case that NTUC helped mediate involving an IT employee.

The worker had served at a non-unionised company for 18 years before his employment was unexpectedly terminated with one month’s notice in February 2026.

After unsuccessfully attempting to negotiate a better exit package with his employer, the worker sought assistance from NTUC. The union’s PME department took up the case, with a representative writing to the company to highlight the employee’s long service record and request mediation.

The effort resulted in the company offering six months of ex gratia payment and an additional month’s bonus, amounting to a settlement of $47,600.

While the positive outcome of this case is being lauded as proof that unions work, some Singaporeans have opined that the case only serves to show that loyalty at workplaces have become a liability instead of an asset.

Facebook user Bobby Sim is among those holding this view. He wrote, in a post that has garnered more than 1,200 reactions, that the settlement only reflected the employer’s goodwill rather than any guaranteed protection.

“The $47,600 was ex gratia. That means ‘by favour.’ The company was not legally required to pay a single dollar of it,” he wrote, “NTUC did not force them. They wrote in, highlighted his record, and the company chose to do the right thing.”

Calling attention to the discretionary nature of such payouts, he added: “Key word: chose. A good employer on a good day. That is not a system. That is luck.”

Mr Sim also pointed out that businesses carrying out retrenchments are often facing financial challenges themselves, making generous payouts difficult or impossible.

“Most companies retrenching staff are not doing it from a position of strength. They are doing it because they are bleeding,” he wrote, “An SME running out of cash cannot write that cheque. A multinational offshoring your role to cut costs has every reason to say no. The situations most likely to get you retrenched are the same situations least likely to give you a payout.”

His post also resonated with workers concerned about whether loyalty to a single employer still carries value in today’s labour market.

“Imagine working at a company for 18 years. Every year you show up. Every year you deliver. Every year you get your performance review and hear ‘good job,’” he said, “18 years of loyalty. 18 years of being reliable. And the reward? A pat on the back, a small bump that barely keeps up with inflation, and then one day an email saying your role is no longer needed.”

Describing what he sees as a changing employment landscape, Mr Sim argued that long-serving employees can become vulnerable as businesses seek lower-cost alternatives or adopt new technologies.

“That is the reality of loyalty in 2026,” he said, “Your company will celebrate your 10-year anniversary with a plaque. Then retrench you in year 11 because they found someone cheaper or an AI tool that does 80% of your job.”

He added, “Your loyalty is not an asset to them. It is a liability. Because the longer you stay, the more you cost compared to someone fresh who will take less.”

Pointing out that retrenchment benefits are not legally mandated in Singapore, Mr Sim said, “The only money you are guaranteed is what is written in your contract. Everything else is goodwill. And goodwill is the first thing to vanish when a company is in trouble.”

Reflecting on the impact of job loss on families, he added, “I think about this as a father of three. A job loss does not land on one person. It lands on a mortgage, school fees, ageing parents, a whole household that never got a vote in the decision.”

He argued that workers today need to take greater responsibility for their own financial resilience and career development.

“The generation before us could work 30 years at one company and retire with a pension. That deal is gone. It is not coming back,” he wrote, “The new deal is simple: you are responsible for your own safety net.”

Encouraging workers to continually upgrade their skills and maintain financial buffers, he advised: “Build skills that are not tied to one company. Save like your job could disappear tomorrow, because it can. Because the day you get that email, the only thing standing between you and panic is what you built for yourself while you were employed.”

Under Singapore’s labour framework, rank-and-file employees and certain executives in unionised companies may be entitled to union representation, with retrenchment benefits often specified in collective agreements negotiated between unions and employers.

Workers employed by non-unionised companies can still seek assistance from NTUC but without a collective agreement or contractual provisions guaranteeing retrenchment benefits, unions can only advocate on their behalf and encourage employers to provide reasonable compensation.

For many workers, having retrenchment benefits explicitly written into employment contracts remains the strongest form of protection, although such provisions are still relatively rare here.

Looking ahead, Mr Tay said NTUC is pushing for stronger safeguards as PMEs face increasing disruption from economic transformation and technological change.

Among the proposals being advanced are earlier retrenchment notices and broader access to the SkillsFuture Jobseeker Support Scheme for involuntarily unemployed workers.

NTUC is also participating in the ongoing review of the Employment Act alongside the Government and employers, with the aim of securing stronger protections for PMEs.

“We’re trying to get more of the PMEs to be aware that they can be part of a union and that actually we can represent them,” Mr Tay said.