In the first quarter of this year, total employment contracted, unemployment rates rose, and retrenchment numbers registered higher than the fourth quarter of 2019.
The Ministry of Manpower (MOM) released these preliminary estimates on 29 April 2020, indicating the early impact COVID-19 has had on the labour market.
In 1Q 2020, total employment registered a contraction of 19,900. MOM attributed this to the significant reduction in foreign employment.
The contraction is the highest since 2003, during the SARS epidemic. In 2003, total employment contracted by 24,000 in its second quarter.
The employment contractions were observed mostly in manufacturing, construction and services, according to MOM.
Services experienced the sharpest decline as consumer-facing F&B services, retail trade and tourism-dependent accommodation were the most severely affected by the COVID-19 outbreak.
However, local employment has managed to grow at a modest pace despite facing difficulties since the start of the COVID-19 outbreak and seasonal influences. There was an increase in employment for healthcare, public administration and professional services, said MOM.
It added that workers who remain in employment might have experienced reductions in working hours or adjustments in their salaries.
“We have to keep in mind that our workforce has a local-foreign composition. What we are seeing is a difference in impact between the two. We have seen a moderate growth for local employment.
“For foreign employment, however, we have seen a much sharper reduction. Part of this is due to the travel restrictions introduced in February. We are seeing that some of them have not returned, or the companies have decided to exercise a decision of asking these workers not to return,” said Manpower Minister Josephine Teo.
The overall unemployment rate in Singapore also rose over the quarter in March 2020, from 2.3 per cent to 2.4 per cent. It remains lower than the one seen during SARS in September 2003, which registered at 4.8 per cent.
It also remains lower than the Global Financial Crisis in September 2009, which registered at 3.3 per cent.
Overall retrenchments for the first quarter of this year stood at 3,000, higher than the previous quarter’s 2,670.
The retrenchment numbers remain lower than the quarterly peak during the Global Financial Crisis, which saw 12,760 individuals being retrenched. MOM attributed the lower retrenchment numbers to the measures announced at Budget and its advice to companies to retain workers and to retrench only as a last resort.
“Even though the local employment is holding up, for now, we are mindful that companies may have implemented cost-cutting measures to save jobs,” said Mrs Teo.
She urged employers to implement non-wage cost-cutting measures first before implementing wage cost-cutting measure. She added that employers should consult and seek advance consent from the unions and employees if they need to cut wages as the last resort.
MOM stated that it will continue to monitor the situation.
Touching on the advance report, Mrs Teo said: “Despite being preliminary, the report gives us a sense of how quickly things have changed. The results are really for January, February and March [2020]. These figures do not yet include the circuit breaker period as it happened only on 7 April. We need to read the data in that context. In the beginning, the hospitality and travel tourism sectors were impacted, but by the time we get to the second quarter, we will see the other sectors being impacted.”
Workforce Singapore (WSG) stated that it is committed to helping reduce the impact of unemployment.
As part of the support to help Singaporean job seekers during this period, WSG has collaborated with MOM and other agencies to roll out the SGUnited Jobs and the SGUnited Traineeships Programme.
It added that the SGUnited Jobs initiative aims to create 10,000 jobs over the next year. These jobs include roles in public service, healthcare, early childhood education, and social services.
Meanwhile, some 4,000 jobs have been pledged towards the SGUnited Traineeships Programme. Applications will open on 1 June 2020.
Singtel was one such company that hired 150 individuals through the SGUnited Jobs initiative. It has also pledged 600 positions towards the SGUnited Traineeships Programme. Some positions include data analysts, market researchers, marketing and communications and finance and human resource.
Touching on the SGUnited Traineeships Programme, Singtel Group Chief Human Resources Officer Aileen Tan said: “We like to play our part as a homegrown company and want to support many of our new and fresh graduates facing a current challenging job situation.”
Commenting on the report, NTUC Assistant Secretary-General Patrick Tay urged employers and businesses to acquaint themselves and better leverage the plethora of support schemes.
“These include training funds to better manage and reduce costs and minimise the need to delve into measures to manage excess manpower. Workers are also encouraged to make use of the downtime to upskill and upgrade themselves virtually through the myriad of training programmes and training funding availed to all workers.
“Most importantly, this is also the time where employers and unions need to have regular open communication, establish the trust and look out for each other. This will then put the organisation and its workers in good stead to ride out the storm and come out of it stronger and more resilient moving ahead.”
