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by JC Admin
Economics News by Econs Tutor Anthony Fok
Topic: Unemployment
Singapore’s total employment contracted at a slower pace in the third quarter of 2020, with resident employment rebounding to near pre-pandemic levels, according to preliminary estimates from the Ministry of Manpower (MOM). Total employment, excluding foreign domestic workers, shrank by 26,900 in Q3, slowing down from the 103,800 seen in the previous quarter. The ministry attributed the decline to the continued contraction in non-resident employment. Retrenchments continued to rise and have exceeded the peak of previous recessions with the exception of the 2009 global financial crisis, which saw 12,760 layoffs. In Q3, there were 9,100 retrenchments, compared with 8,130 in Q2. On the whole, unemployment rates continued to rise. Overall unemployment rate rose to 3.6 per cent in September compared to 3.4 per cent in August; resident unemployment rate inched up to 4.7 per cent from 4.6 per cent and citizen unemployment rate went up to 4.9 per cent from 4.7 per cent over the same period.
During a media briefing, Manpower Minister Josephine Teo said the growth in resident employment is partly attributed to the resumption of activities as Singapore began its phased reopening, following its partial economic shutdown during the “circuit-breaker” period in April and May.
“Some positions had gotten vacated in the second quarter, and so in the third quarter, since business activities have resumed, so there is a little bit more backfilling of those positions,” Mrs Teo said.
In addition, employers and workers have been very invested in collective efforts to save jobs, such as through wage cuts and retraining programmes, she said. However, Mrs Teo said it would not be wise to assume that the rebound in resident employment levels can be sustained without effort. While the fourth quarter of the year typically sees an uplift in past years, this is due to increased seasonal spending, travel and tourism, which are subdued this year, she said, as consumer sentiment turns cautious and borders remain largely closed. She added that many countries are now fighting a second or even third wave of infections, so one should not assume the path ahead to be easy.
“We have a little bit of a reprieve now – the third quarter is, to me, a source of relief. But it simply means we’ve gotten ourselves to a level where the ship is more stabilised but we need to put in the effort to keep it sailing,” she said.
Questions for discussion during economics tuition classes:
- Explain the various causes of unemployment in Singapore.
- Discuss the policies available to solve the unemployment problem in Singapore.
