Singapore’s overall unemployment rate rose to its highest level in a decade, according to preliminary data from the Ministry of Manpower (MOM) released today (29 July).
Unemployment rose from 2.4 per cent in the first quarter to 2.9 per cent in the second quarter this year. The total employment rate, excluding foreign domestic workers, also fell four-fold in the second quarter.
Over 121,800 workers were registered as unemployed, bringing the total unemployment to 147,500 for the first half of 2020.
Of the total unemployment numbers, over 90,500 residents were registered as unemployed, of whom 79,600 were Singaporean citizens.
Singaporeans and permanent residents experienced a rise in the unemployment rate from 3.3 percent in the first quarter to 3.9 per cent in the second quarter.
Service Sector Is Hit The Hardest
Retrenchments also more than doubled in the second quarter, with over 6,700 workers laid off — almost double from 3,220 in the first quarter.
According to MOM, the rise in retrenchments was consistent across the board in the manufacturing, services and construction industries.
The decline in employment was most drastic in the food and beverage, retail trade, arts, entertainment and recreation, and education industries. Employment in construction also declined sharply.
In contrast, the manufacturing industry experienced a relatively “modest” contraction.
Despite the drop in employment, overall unemployment rates remain lower than in the 2009 global financial crisis (3.3 per cent) and 2003 SARS outbreak (4.8 per cent).
MOM added that retrenchment numbers may surpass the 2003 SARS epidemic (5,510) but remain below the peak of the 2009 global financial crisis (12,760).
Downward Trend Expected To Continue
Manpower Minister Jospehine Teo stated on 29 July that the contraction in employment was “reflective of the workforce composition,” in terms of the spread between local and foreign workers.
However, the specific proportions have not yet been released to the public.
Social distancing measures and the circuit breaker have drastically reduced the profitability of businesses which require face-to-face interactions.
While businesses have been adapting to the new set of circumstances under Covid-19 conditions, the repercussions have still been felt.
Singapore is now experiencing a technical recession. The country’s economy shrunk by 41.2 per cent in the second quarter, according to estimates from the Ministry of Trade and Industry earlier this month.
“Softness in the labour market is likely to persist with continued weakness in hiring and pressure on companies to retrench,” MOM stated in a press release.
Government Steps Up Job Support
Tan Choon Shian, Workforce Singapore’s chief executive reiterated that the board was stepping up efforts to aid job seekers.
This includes setting up SGUnited Jobs and Skills Centres, providing virtual career fairs and sending out a roving career centre truck. To date, the centres have aided 1,300 job seekers, Tan reported.
The Singaporean government has also created a Jobs Support Scheme coordinated through the National Jobs Council.
The SG United Traineeship Programmes for new and recent graduates will also be expanded to a Mid-Career Pathways Programme, with over 13,000 available positions.
“For jobseekers who are unable to secure a job due to the weak labour market, attachments and training opportunities will be provided for them to gain industry-relevant skills to help them do so once the market recovers,” MOM reiterated.
Featured Image Credit: Wan Wei