Singapore's labour market in 2021: Retrenchments declined, employment rose, unemployment rates dropped

A total of 3,397,200 persons were in employment in December 2021 (excluding MDW), of whom 2,443,100 were residents — 3.7% above the level in December 2019.

Singapore's labour market made a "significant recovery" in 2021, the Manpower Research and Statistics Department, Ministry of Manpower (MOM)'s latest report revealed on Monday (14 March 2022).

According to the report, titled Labour Market Report 2021, total employment (excluding migrant domestic workers) rebounded in 2021, with a growth of 41,400, following a sharp contraction in 2020 (-166.600). This rebound, the report noted, was attributed to faster growth in resident employment (+71,300) which more than offset the decline in non-resident employment (-30,000).

Excluding work permit holders in construction, marine shipyard & process sectors, total employment growth stood at 34,000 in the year, "reversing the significant contraction of 107,500 in 2020," the report added. However, the numbers have "not yet returned to the pace of growth pre-COVID."

December 2021 employment data

A total of 3,397,200 persons were in employment in December 2021 (excluding MDW), of whom 2,443,100 were residents — 3.7% above the level in December 2019.

Additionally, despite the Q4 2021 gains in non-resident employment, the non-resident employment level in December 2021 remained 18% below that in December 2019; and non-residents made up 28.1% of total employment. This remained below the one-third share in December 2019, due to "sustained reductions in non-resident employment." While employment of non-residents declined in most sectors, an increase was observed in the construction sector.

Looking at resident employment — this grew across most sectors, with health & social services and administrative & support services also posting "notable gains" in the year.

Reflecting the effects of tight travel restrictions for the most part of the year, the report stated that resident employment fell in accommodation, arts, entertainment & recreation, and air transport & supporting services, though at a moderated pace compared to 2020. 

Unemployment

On the unemployment front, the annual average unemployment rates recorded in 2021 were "significantly lower" than in 2020, reflecting the "steady improvement in the unemployment situation throughout the year."

In particular, the numbers dropped from 3% to 2.7% overall; 4.1% to 3.5% for residents, and 4.2% to 3.7% for citizens.

Meanwhile, the annual average resident long-term unemployment rate (1%) remained unchanged between 2020
and 2021, and remained elevated compared to 2018-2019 (0.7%). 

December 2021 unemployment data

The seasonally adjusted unemployment rates remained on a downward trend in the last month of the year (overall: 2.4%; resident: 3.2%; citizen: 3.4%). Compared to September, resident unemployment rates declined across most age and education groups. Among residents in their 30s and 40s where the rate increased, it remained below the levels seen in the first half of the year.

Moving to 2022, unemployment rates continued to improve in January (overall: from 2.4% to 2.3%; residents: from 3.2% to 3.1%; citizens: from 3.4% to 3.3%), "closing in on the average levels in 2018/2019."

Retrenchment

Coming to retrenchment data, the number of retrenchments recorded in Q4 2021 remained low, according to the report, with 0.7 retrenched per 1,000 employees. The majority came from the services sector, led by wholesale trade and financial services. These sectors tend to have retrenchments as part of business re-organisation/restructuring, the report highlighted.

Among residents, the incidence of retrenchment "held steady or declined" for most age, education and occupational groups, except among older residents aged 60 & over where the incidence rose but "did not exceed the quarterly pre-COVID levels.

2022 outlook

Sharing a 2022 outlook in a Facebook post following the report's release, NTUC Assistant Secretary-General Patrick Tay noted: "Employers will need to brace for a tight labour market and look at ways to redesign and reinvent employees’ work and workplaces, and embrace technology/automation/mechanisation/robotisation/AI/digitalisation to keep pace with the developments coupled with training and equipping their workforce for developments/changes.

"Workers will need to continue to embrace CET and Lifelong Learning to stay ready with new skills, relevant for new/transformed jobs, and resilient to new changes as we pivot and transform to the next normal of work."

He also pointed out that the outlook for various sectors "continues to be uneven and possibly uncertain" with a slow and gradual recovery of the tourism and aviation-related sectors, amidst the gradual loosening of global travel restrictions, and the nascent recovery in global travel demand. Employment levels in these sectors may take longer to return to pre-COVID levels, he added.

Lead image /  Labour Market Report 2021