Singapore's Q3 2019 labour market: Employment increased, retrenchments stayed low

The third quarter of 2019 saw a mixed labour market situation.

According to the Labour Market Report Third Quarter 2019 released by the Ministry of Manpower (MOM), employment increased, retrenchments stayed low and re-entry rates improved. However, unemployment and long-term unemployment rates inched up.

Total employment (excluding foreign domestic workers) grew by 21,700, higher than the previous quarter (6,200) and a year ago (16,700). The bulk of total employment growth came from the Services sector, led by modern services, community, social & personal services, and administrative & support services.

While retrenchments in 3Q 2019 (2,430) were slightly higher than in the previous quarter (2,320),  it remained lower than a year ago (2,860).

Comparing 12-month periods, retrenchments from October 2018 to September 2019 (10,490) was significantly lower than the preceding 12-month periods - Oct 2017 to Sep 2018 (11,900), and Oct 2016 to Sep 2017 (16,480).

According to MOM, the top reason for retrenchments was business restructuring and reorganisation.

On the bright side, retrenched residents found new jobs faster than during the previous quarter and a year ago.

The six-month re-entry rate into employment in 3Q 2019 was revealed to be 65% - higher than previous quarter (60%) and a year ago (62%). This improvement was broad-based across most age, education and occupational groups (except for production & related workers).

Similar to retrenchment rates, unemployment rates and long-term unemployment rates for residents inched up over Q3 2019, increasing by 0.1 percentage point (pp) from the previous quarter.

At the overall level, unemployment rate increased from 2.2% to 2.3%, while resident unemployment rate increased from 3.1% to 3.2%, and citizen unemployment rate from 3.2% to 3.3%. The seasonally-adjusted resident long-term unemployment rate also edged up slightly from 0.6% in June 2019 to 0.7% in September 2019.

At the same time, the seasonally-adjusted number of job vacancies declined from 47,700 in June 2019 to 42,200 in September 2019.

This, together with the slight increase in the number of unemployed, pushed the adjusted ratio of job vacancies to unemployed persons down from 0.94 in Q2 2019 to 0.83 in Q3 2019.

The sliver lining is that job vacancies continue to be available, particularly in services sectors such as community, social & personal services, financial & insurance services, professional services and information & communications.

According to MOM, the above may have been a result of hiring caution as can be seen in the smaller number of vacancies.

The MOM report also revealed statistics on labour turnover and hours worked, as follows:

• The seasonally adjusted recruitment rate was 2.2% - similar to the previous quarter (2.2%) and a year ago (2.3%).
• Resignation rates (seasonally adjusted) came in at 1.8% - previous quarter (1.28) and a year ago (1.7%).
• While trends by industry were mixed, turnover rose more in security & investigation and food & beverage services. However, a decline was observed in most sub-manufacturing industries, especially in electronics and food, beverages & tobacco manufacturing.
• There was an uptick in the average total weekly paid hours worked per employee between June 2019 (44.7 hours) and September 2019 (44.8).
• Security & investigation posted the highest increase in hours worked over the year, while transportation & storage and Manufacturing (led by paper, rubber, plastic products & printing and electronics) saw pronounced declines.