SINGAPORE: Total employment in Singapore is estimated to have increased by 16,400 jobs, or 0.4 per cent, in 2016, according to the Ministry of Manpower's (MOM) Labour Market Advance Release on Thursday (Jan 26).
This is lower than the 32,300, or 0.9 per cent, growth in 2015, and represented the lowest growth since 2003, the ministry's report noted.
The moderation in total employment in 2016 took place amid slower growth in the
Singapore economy, a slowdown in local labour force growth and continued tightening of the supply of foreign workforce, it added.
For the fourth quarter of last year, total employment grew by 1,900, compared to a contraction of 2,700 in the previous quarter. But growth was lower than the 16,100 of the same quarter in 2015.
Ms Selena Ling, head of treasury research and strategy at OCBC Bank, anticipates that domestic labour will continue to soften due to a combination of sluggish domestic business conditions coupled with an uncertain external business climate due to US President Donald Trump’s policy uncertainties and the continued slowdown in China.
"This could drag the overall unemployment rate higher to around 2.5 per cent this year, and the net employment data could moderate further or risk another contraction in the quarters ahead," she said.
FOREIGN EMPLOYMENT CONTRACTS FOR FIRST TIME SINCE 2009
Delving deeper, local employment increased by an estimated 10,700, or 0.5 per cent, in 2016 and this growth occurred in many services sectors, including community, social and personal services, professional services and transportation and storage.
Foreign employment, excluding foreign domestic workers, contracted last year by 0.2 per cent - a first since 2009, the figures showed. The declines were mainly in construction and marine, it added.
For the fourth-quarter findings, MOM said estimates showed that seasonally-adjusted unemployment rose from 2.1 per cent in September to 2.2 per cent in December 2016. Unemployment for residents grew from 2.9 per cent to 3.2 per cent and for citizens grew from 3 per cent to 3.5 per cent.
"This occurred even as employment grew as more people entered the labour force to look for work," it said.
MOM said in December last year, locals made up 66.4 per cent of persons employed here, excluding foreign domestic workers, while foreigners made up the remaining 33.6 per cent.
Redundancies rose to 19,000 last year, going up steadily since 2010, according to the report. The number of workers laid off in 2015 was 15,580, while it was 12,930 in 2014.
The nominal median income, including employer CPF contributions, of full-time employed Singaporeans rose by 0.7 per cent year-on-year to S$3,823 last year, or 1.3 per cent in real terms after adjusting for negative inflation, MOM said.
However, this growth was moderated from the increase of 6.5 per cent (nominal) and 7 per cent (real) in 2015, the ministry added.
WORST COULD BE OVER: ANALYSTS
Analysts Channel NewsAsia spoke to said that with stronger growth in Singapore's economy, the worst could be over.
DBS Bank senior economist Irvin Seah said that the numbers were consistent with the economic growth cycle of 2016, with growth bottoming out in the third quarter before bouncing back in the fourth quarter. "That has been reflected in the employment figures as well,” he noted.
Human resources agency Randstad also said it was expecting more employers to hire in the year ahead.
Managing director for Randstad Singapore, Hong Kong and Malaysia, Michael Smith, said that although it was early in the first quarter, the agency was already observing a pick-up in job growth, and that employers were looking to hire with a "cautious sense of optimism" compared to the same time last year.
”Ultimately, we don't expect it to gather a large amount of pace any time soon, as a result of the economic conditions being moderate. However, we do expect things to pick up.”