Unemployment rates fall to near pre-pandemic levels, job market recovery to extend in 2022: MOM
SINGAPORE: Total employment rebounded in 2021, with unemployment rates dipping to near pre-pandemic levels, the Ministry of Manpower (MOM) said in its 2021 Labour Market Report released on Monday (Mar 14).
The labour market recovery is expected to continue this year, with economic growth gaining momentum, and hiring and job vacancies going up, said MOM.
But the ministry warned that increased downside risks in the global economic outlook could weigh on the pace of recovery.
"We expect the labour market to continue to improve in 2022, but of course, events in recent weeks have significantly increased the downside risks and therefore it will weigh on the pace of recovery," said MOM permanent secretary Aubeck Kam at a briefing on Monday morning.
The annual average unemployment rate fell from 3 per cent to 2.7 per cent, with resident unemployment rate decreasing from 4.1 per cent to 3.5 per cent.
The citizen unemployment rate is now 3.7 per cent, down from 4.2 per cent. In January 2022, unemployment rates declined to around December 2019 levels, said MOM.
Total employment rebounded in 2021, growing by 41,400, after a sharp contraction in 2020 when 166,600 jobs were lost.
Gains in resident employment were larger in information & communications, health & social services, professional services, administrative & support services, and financial services.
However, it fell moderately in accommodation, air transport & supporting services, and arts, entertainment & recreation, due to tight travel restrictions for the most part of the year.
RETRENCHMENTS FELL TO PRE-COVID LEVELS
With the gradual easing of border restrictions, non-resident employment increased in the fourth quarter of 2021 for the first time in two years.
In the last quarter of 2021, resident employment rose by 23,700, picking up from the previous quarter, while non-resident employment increased by 24,200. This adds up to total employment growth of 47,900, after two quarters of decline.
For the whole year, there was faster growth in resident employment, which went up by 71,300, offsetting a decline in non-resident employment of 30,000.
Among non-residents, the number of Employment Pass holders fell by 15,300 and the number of S Pass holders by 12,200. Work Permit and other work pass holders fell by a smaller extent at 2,400.
By industry, non-resident employment declined in all sectors, except for construction, which was boosted by the increase in the final quarter of 2021 as border restrictions eased, said MOM.
Retrenchments fell from a high of 26,110 in 2020 to 8,020 in 2021, below levels seen in pre-COVID years.
Fewer employees were placed on short work-week or temporary layoff by the fourth quarter of 2021, though the number, at 1,200, remains above pre-pandemic levels.
The annual re-entry rate among retrenched residents rose from 62 per cent in 2020 to 66 per cent in 2021 - a six-year high.
The seasonally adjusted recruitment rate reflected more job opportunities, trending higher to 2.5 per cent in the fourth quarter of 2021 - a rate last seen in 2014.
The seasonally adjusted resignation rate held steady over the quarter at 1.7 per cent, slightly below the typical pre-COVID rate.
In February, the Ministry of Trade and Industry (MTI) maintained Singapore’s GDP growth forecast for 2022 at 3 per cent to 5 per cent.
Since then, downside risks in the global economic outlook have increased amid the Russia-Ukraine conflict, said MOM.
The outlook for the various sectors continues to be uneven.
Barring a sharp slowdown in the global economy, growth is expected to be positive in outward-oriented sectors, including information & communications and financial & insurance services.
Consumer-facing sectors, such as food & beverage services and retail trade are projected to benefit from the gradual easing of COVID-19 measures in Singapore, and more workers will be needed to support the pick-up in business activities.
However, the recovery of the tourism and aviation-related sectors is expected to be slow with the gradual loosening of travel restrictions globally, and the nascent recovery in global travel demand.
"Employment levels in these sectors may take longer to return to pre-COVID levels," said MOM.
The annual average resident long-term unemployment rate in 2021 was 1 per cent, remaining unchanged over the year and was elevated compared to 2018-2019, when it was 0.7 per cent. This is as structural mismatches tend to take longer to dissipate, said MOM.