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Resident employment expands at slower pace in Q2 amid tighter COVID-19 measures

SINGAPORE: Resident employment for Singaporeans and permanent residents continued to expand in the second quarter of 2021, although at a slower pace due to the impact of tighter COVID-19 restrictions, advance estimates from the Ministry of Manpower (MOM) showed on Friday (Jul 30).

The slower resident employment growth from April to June was attributed to declines in domestic sectors impacted by the Phase 2 (Heightened Alert) measures. These include food & beverage services and the retail trade. 

On the other hand, resident employment continued to grow steadily in sectors such as information and communications and professional services, as well as in health and social work, said MOM.

READ: COVID-19 restrictions to be reviewed in early August, any easing only for vaccinated people: Lawrence Wong

During Singapore’s previous Phase 2 (Heightened Alert) period from May 16 to Jun 13, group sizes for gatherings were cut to two people and dining-in at all F&B outlets were banned. People were also told to continue to work from home by default during this period.

“We had expected that the Phase 2 (Heightened Alert) restrictions in May and June would place constraints on this recovery in the second quarter,” said Manpower Minister Tan See Leng.

“In particular, the tightened restrictions had a greater impact on domestically oriented sectors … However, it is heartening to see that our outward-oriented sectors and healthcare sectors continue to maintain their growth trajectories.”

READ: Employment grows more than expected in Q1, but uncertainties weigh on recovery: MOM

While resident employment continued to grow, total employment in the second quarter fell due to a steep decline in employment of foreign workers, according to the Labour Market Advance Release for the second quarter.

This comes after total employment in the first quarter grew for the first time since the start of the COVID-19 pandemic.

“Non-resident employment declined more sharply across most sectors, as departing workers were not replaced due to border restrictions imposed for public health reasons,” said MOM.


Unemployment rates eased further in June, although they were not yet back to pre-pandemic levels.

The overall unemployment rate dipped from 2.8 per cent in May to 2.7 per cent in June, continuing a trend of gradual decline since it peaked in September 2020.

Citizen unemployment rate fell from 4 per cent in May to 3.8 per cent in June, while resident employment rate fell from 3.8 per cent to 3.7 per cent.

READ: Singapore's unemployment rates continue to fall in May

Retrenchments increased slightly to 2,500 from 2,270 in the previous quarter. 

Companies cited re-organisation and restructuring or business downturn as common reasons for the layoffs, said MOM. 

“We have not observed any notable increases in retrenchments in sectors directly impacted by the tighter restrictions such as food & beverages services,” the ministry said. 

It added that it expects the incidence of retrenchment in the second quarter, at 1.3 retrenched per 1,000 employees, to be similar to that in the previous quarter, when it was 1.2. This is comparable to the levels observed in 2018 and 2019, said MOM.

READ: More than 270,000 locals hired under Jobs Growth Incentive: MOM

On the whole, the tighter measures, as well as a rise in the Delta variant in COVID-19 cases
globally, had also dampened hiring sentiments among companies, said MOM.

It added that a majority of companies polled in June (64  per cent) indicated they had plans to hire, compared with 73 per cent in March.

Dr Tan said that with Singapore’ return to Phase 2 (Heightened Alert) from Jul 22 to Aug 18 following a surge of COVID-19 infections, continued restrictions on the inflow of migrant workers are expected.

“In the months ahead, we expect to face more challenges,” said Dr Tan.

”I want to encourage all businesses and workers, especially those who have been hit hard by the latest tightening of restrictions to press on amid recent challenges.”

More details will be provided in the Labour Market Report 2Q 2021, to be released in mid-September.

Source: CNA/hm


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