Sir, yesterday’s release of strong February non-oil domestic export figures add to the confidence that the Singapore economy is en route to recovery. This is certainly to be welcomed.
I am sure that many Singaporeans, especially the unemployed ones, will look forward to this recovery and hope that the threat of retrenchment will recede while the prospect of employment will improve.
I want to sound a note of caution here. We cannot assume that economic recovery, even when it is really sustained, will automatically solve all employment challenges for Singaporeans.
According to statistics available on the MOM website, the resident Long-term unemployment rate, defined as the proportion of the labour force who have been unemployed for at least 25 weeks, as climbed steady from 0.4% or about 5700 persons in 1997 to 1.4% or 25,100 persons in 2003.
Yes, part of this increase in the long-term unemployed will be accounted for by cyclical reasons, namely the difficult demand conditions faced by the economy over the past 5 years. But I would think that there are also structural reasons behind the increase.
Fast changing technology, the consequent demand for better-skilled manpower, and the overall transformation of the economy toward knowledge-based and higher-value work have come together to render re-employment for some displaced workers very difficult. The threat of growing structural unemployment is therefore real, and will not go away simply because the economy is picking up.
I also note that the percentage of workers in temporary employment and part-time work have risen from 1.7% and 3.3% respectively in 1997 and 4% and 5.7% respectively in 2003. Although these figures are still low compared to those in some advanced economies, it still reflects an underlying trend and structural shift in the make-up of our workforce, as companies move toward maintaining a smaller core of employees, and pursuing flexibility through outsourcing and employing supplementary manpower on a needs basis.
This trend implies that even as hiring picks up with the economic recovery, the kinds of jobs that Singaporeans seeking work will find will be different from the ones that have been restructured away. The terms and conditions of such work will also be different from the traditional full-time permanent jobs. There will be implications on how to then help Singaporeans holding such jobs meet their longer-term basic needs in retirement, training and healthcare.
The third observation that I would like to make is that, according to the Labour Market Report 2003, “For the second consecutive year, professionals, managers, executives & technicians (PMET) (16.7 retrenched per 1000 employed) overtook production & related workers (15.8 per 1000) to post the highest incidence of retrenchment. The PMETs accounted for the largest group (40%) of locals retrenched in 2003 compared with production & related (34%) and clerical, sales & services (26%) workers.” Beyond cyclical reasons, I believe and this result points to the trend of delayering. Again, I do not think that the underlying trend will disappear or be reversed when the economy picks up.
Sir, in the light of these structural shifts, I believe that even as the economy recovers, and the need for suitably-skilled manpower grows, that we may yet encounter sticky unemployment of 3 or 4% of the workforce. Getting back to the 2% level of unemployment that Singaporeans have become accustomed to in the years prior to 1997 will be a challenge.
I therefore ask the Minister what plans would his Ministry have to maximize the employment and re-employment opportunities for Singaporeans in this recovering economy. I would also like to the Minister to tell us how his Ministry intends to tackle the structural shifts that I noted earlier, and thereby secure more good jobs for Singaporeans.
