Retrenchments in Singapore doubled in 2023 from the previous year to 14,320, even as overall unemployment rates fell slightly.
Total employment growth here for the full year of 2023 slowed amid weaker economic conditions, following a sharp, post-pandemic rebound in 2022.
According to preliminary estimates released by the Ministry of Manpower on Jan 31, the more muted pace of growth was seen for both residents and non-residents.
Every quarter, while the increase in total employment, excluding migrant domestic workers, moderated significantly, it continued to grow for the ninth consecutive quarter, expanding by 8,400 in the last quarter of 2023.
The ministry said: “This moderation was not unexpected as weaker hiring expectations and declining job vacancies from previous quarters indicated cooling labour demand.”
Business reorganisation or restructuring remained the top reason for retrenchments in 2023, due in part to the impact of global economic headwinds on outward-oriented sectors such as wholesale trade, IT services and electronics manufacturing.
However, every quarter, the number of retrenchments in the fourth quarter of 2023 fell to 3,200 compared to 4,110 in the third quarter, which was marked by a surge in wholesale trade retrenchments.
MOM added that while retrenchments rose in electronics manufacturing, the number of retrenchments in other sectors remained broadly stable or declined.
For the full year of 2023, the overall unemployment rate dipped slightly to 1.9%, from 2.1% in 2022. The rate for Singaporeans was 2.9% in 2023, down from 3%, while the rate for Singaporeans and permanent residents combined was 2.7%, down from 2.9%.
On a monthly, seasonally-adjusted basis, the unemployment rates in December 2023 were the same as that in November. The overall rate was 2%.
The ministry added that based on its surveys, it expects improved business expectations in 2024, with the Ministry of Trade and Industry also indicating expectations of improved economic growth prospects.
The MOM said the proportion of firms which indicated an intention to hire in the next three months rose from 42.8% in the previous quarter to 47.7% in 4Q 2023. Likewise, the proportion of firms to raise wages rose from 18% to 32.6% over the corresponding periods.
While employment prospects might be looking up, the MOM cautions that as downside risks in the global economy remain, business reorganisation or restructuring will continue and may lead to further retrenchments.
The ministry said: “The Government strongly encourages employers and workers to make full use of available programmes to remain competitive and resilient amidst economic uncertainty. Employers should press on with business transformation and equip their workers for expanded or redesigned job roles. Workers are encouraged to continue to upskill and be open to new opportunities.” – The Strait Times
