SINGAPORE: Retrenchments in the first half of this year rose to its highest since the 2009 financial crisis, while employment saw a record plunge as COVID-19 took a huge toll on the labour market.
A total of 11,350 people were laid off in the first half of 2020, higher than the 10,120 recorded during the SARS period but still lower than other recessionary peaks, said the Ministry of Manpower (MOM).
AdvertisementAdvertisementAnother 81,720 employees were placed on shorter work-weeks or temporary laid off in the second quarter as business activities were suspended during the two-month "circuit breaker" between April and June.
The six-month re-entry rate among retrenched residents in the second quarter of this year also fell to a record low of 58 per cent.
Total employment, excluding foreign domestic workers, contracted by 129,100 in the first half of 2020 - the largest half-yearly reduction on record.
Foreign employment fell by 5.7 per cent, or -66,400, which was sharper than the 2.7 per cent decline, or -62,700, in local employment.
AdvertisementAdvertisementMost of the foreign employment cuts were among holders of work permit and other work passes (-51,100), followed by S Passes (-11,200) and Employment Passes (-4,100).
Excluding work pass holders from the construction, marine shipyard and process industries, the decline in work permit and other work passes was -32,900 in the first half of this year.
Foreign cutbacks were also more widespread across industries, based on the employment diffusion index, which recorded 38.4 for locals and 16.8 for foreigners.
The metric measures how widespread the employment change across industries is.
UNEMPLOYMENT UP
The seasonally adjusted jobless rates has crept up over the past few months, hitting 4.0 per cent among citizens, 3.8 per cent among residents and 2.8 per cent overall in June.
In July, it climbed to 4.3 per cent among citizens, 4.1 per cent among residents and 3.0 per cent overall.
This is still below previous recessionary highs, when the overall unemployment rate reached 3.3 per cent in September 2009 and 4.8 per cent in September 2003.
MOM said this is the first time it is releasing seasonally adjusted monthly unemployment rates and it will do so in the future.
The increase in the resident unemployment rate was due to a rise in the number of short-term unemployed people, MOM said, as the seasonally adjusted resident long-term unemployment rate dipped in June 2020 from 0.9 per cent to 0.8 per cent.
Fewer job vacancies were also available, from 46,300 in March to 42,400 in June, while the seasonally adjusted ratio of job vacancies to unemployed persons fell from 0.7 in March to 0.57 in June.
However, job vacancies the last quarter rose in sectors like financial services, public administration and education, MOM said.
The ministry added that with continued uncertainties in the global economy as well as subdued external demand, it will continue to weigh down the labour market in the second half of this year.
It noted that the Ministry of Trade and Industry has projected that Singapore’s GDP in 2020 will contract by between 5 per cent and 7 per cent.
“Softness in the labour market is likely to persist with continued weakness in hiring and pressure on companies to retrench,” it said.
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