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Statement on Labour Market Developments


  1. The labour market improved in 2017, in line with the pick-up in economic activity. While the resident long-term unemployment rate held steady in December 2017, the unemployment rate declined from a year before. Local employment growth in 2017 was nearly double that of 2016, while foreign employment declined more than it did the year before. There were also significantly fewer retrenchments and more job vacancies. At the same time, productivity growth was more than double that of 2016.

    Review of 2017


    The resident unemployment rate declined over the year, while long-term unemployment rate remained unchanged
  2. From a high of 3.2% in December 2016, the seasonally-adjusted resident unemployment rate declined over the course of 2017 to 3.0% in December 2017. The decline was across all education groups, except for degree holders. At the same time, the seasonally-adjusted resident long-term unemployment rate2 remained at 0.8%, unchanged from a year before.

    Local employment growth nearly doubled that of 2016
  3. Local employment grew by 21,300 in 2017, nearly double the growth in 2016 (11,200) (Figure 1). Growth occurred mainly in the Financial & Insurance Services, Information & Communications, Professional Services, and Healthcare sectors, which have relatively higher shares of Professionals, Managers, Executives & Technicians (PMETs) occupations.

    Foreign employment continued to contract, with a larger decline in 2017
  4. Foreign employment (excluding FDW) declined by 32,000 in 2017, compared to the slight contraction in 2016 (-2,500) (Figure 1). The decline was mainly due to a decrease in Work Permit Holders (-32,200) in sectors such as Marine Shipyard and Construction.
  5. S Pass holders grew by 4,700, while Employment Pass (EP) Holders declined (-4,500). The decline in EP holders was mainly in Professional Services and Information & Communication, sectors which saw growth in local employment.

    Figure 1: Annual Employment Change (Excluding FDW) by Residential Status, 2012-2017
  6. On the whole, total employment (excluding FDW) declined by 10,700 in 2017. With local employment growth and foreign employment contraction in 2017, the local share of total employment (excluding FDW) rose from 66.4% in December 2016 to 67.2% in December 2017.

    Retrenchments and Job Vacancies3

    Retrenchments were significantly lower in 2017, and the resident six-month re-entry rate remained stable
  7. Retrenchments declined to 14,720 in 2017, significantly lower than that in 2016 (19,170) but higher than in earlier part of the decade when retrenchments averaged about 12,000 between 2011 and 2015. The main reason for retrenchments in 2017 continued to be business restructuring and reorganisation. Residents remained proportionately less affected, with their share of redundancies (61.9%) remaining lower than their share of employment (67.2%).
  8. The annual4 six-month re-entry rate into employment of retrenched residents remained stable at 64.6% in 2017, similar to 2016 (64.5%). In particular, younger workers below 30 (80.7%) and Clerical, Sales & Service Workers (71.6%) had the highest rates of re-entry.

    Ratio of job vacancies to unemployed persons improved for the fourth consecutive quarter
  9. The seasonally-adjusted job vacancies to unemployed ratio improved for the fourth consecutive quarter to 0.92 in December 2017. There were also more job vacancies in December 2017 (49,700), higher than a year before (December 2016: 47,400).


    Higher citizen income growth at the median and 20th percentile
  10. The nominal median monthly income from work5 (including employer CPF contributions) of full-time employed Singaporeans increased by 5.9% over the year to $4,050 in June 2017, or 5.3% in real terms6. This was faster than the growth in June 2016 (nominal: 0.7%, real: 1.3%), and could reflect the pick-up in economic growth and changes in the composition of the labour force.
  11. From 2012 to 2017, real income7 growth at the 20th percentile of full-time employed Singaporeans (4.3% per annum) was faster than at the median (3.9% per annum), supported by initiatives to raise the incomes of low-wage workers in recent years.


    Labour productivity growth was more than double that of 2016
  12. Overall labour productivity (as measured by value-added (VA) per actual hour worked) rose by 4.5% in 2017, more than double the growth of 1.8% in 2016 (Figure 2). Similarly, VA per worker rose by 3.8% in 20179, higher than the growth of 1.4% in 2016. Overall productivity growth10 in 2017 was supported by gains in the Manufacturing, Wholesale & Retail Trade, Transportation & Storage, Financial & Insurance Services, Business Services and Construction sectors. On the other hand, productivity declined in the Information & Communications and Accommodation & Food Services sectors.

    Figure 2: Productivity (%) - Overall Economy

    Sectoral Performance and Outlook

  13. Employment in the Manufacturing sector continued to decline in 2017 (-11,300), but at a slower pace than in 2016 (-15,500). The decline was due to a decrease in Work Permit Holders in the Marine Shipyard segment, as the segment continued to be weighed down by the weak demand for oil rigs amid the low oil price environment. Excluding the Marine Shipyard segment, employment in the Manufacturing sector grew in 2017 by 2,400. Growth occurred mainly in segments such as Electronics, Computer & Optical Products and Food, Beverage & Tobacco, which saw healthy output expansion.
  14. On the back of strong VA growth, productivity in the Manufacturing sector rose by 14.4% in 2017, higher than the 8.3% registered in 2016 (Figure 3a).

    Figure 3a: Productivity (%) - Manufacturing
    Figure 3b: Year-on-Year (YoY) Growth (%) - Manufacturing
  15. Manufacturing Outlook. While the 2018 growth outlook for the Manufacturing sector as a whole continues to be positive, the hiring outlook remains modest. Notably, the Marine Shipyard segment is likely to continue to pose a drag on employment growth, due to weak demand conditions faced by local yards and firms producing oilfield and gasfield equipment amid the low oil price environment and excess capacity in the global offshore rig market.

  16. Employment in the Construction sector fell by 38,300 in 2017, continuing the decline in 2016 (-11,500). The decline was mainly at the Work Permit Holder level, due to continued weakness in construction activities. Productivity growth was subdued at 0.3% in 2017, compared to the growth of 1.0% in 2016 (Figure 4a).

    Figure 4a: Productivity (%) - Construction
    Figure 4b: YoY Growth (%) - Construction
  17. Construction Outlook. Construction output in 2018 is expected to remain subdued, due to the slowdown in overall construction demand since 2015. The continued weakness in private sector construction activity is likely to weigh on employment in the sector, although a healthy pipeline of public sector construction works may provide some support to hiring.

  18. The Services sector registered employment growth in 2017. Total employment (excluding FDW) in the Services sector grew by 39,300 in 2017, higher than in 2016 (36,000). Employment growth was broad-based, with growth driven by the Community, Social and Personal Services, Financial & Insurance Services, Transportation & Storage, Administrative & Support Services, and Information & Communications sectors.
  19. Productivity in the Services sector grew by 1.5% in 2017, compared to the flat growth (0.0%) in 2016 (Figure 5a). The productivity declines in the Accommodation & Food Services and Information & Communications sectors were more than offset by productivity gains in the Wholesale & Retail Trade, Transportation & Storage, Financial & Insurance Services, and Business Services sectors.

    Figure 5a: Productivity (%) - Services
    Figure 5b: YoY Growth (%) - Services
  20. Services Outlook. With the external demand expected to remain firm in 2018, this will provide support to employment growth of externally-oriented services sectors such as Financial & Insurance Services, Transportation & Storage and Wholesale Trade. At the same time, employment growth in the domestically-oriented services sectors is expected to remain resilient. Specifically, sectors such as the Community, Social & Personal Services, particularly the Health & Social Services segment, should continue to see robust demand for manpower.

    Employment Outlook for 2018
  21. The Ministry of Trade and Industry (MTI) has projected that the Singapore economy will grow by 1.5% to 3.5% in 2018, with growth likely to come in slightly above the middle of the forecast range, barring the materialisation of downside risks. Against this backdrop, MOM expects local employment to continue to grow this year, albeit with some continued unevenness across sectors. Hiring is expected to remain cautious in sectors such as Construction and Marine Shipyard, while job opportunities will continue to be available in the Manufacturing sector as well as the Services sectors, particularly Infocomms & Media, Finance & Insurance, Healthcare, Professional Services, Logistics and Wholesale Trade.
  22. Looking ahead, total workforce growth will remain modest due to demographic trends affecting the local workforce and moderated foreign workforce growth.

  23. In 2017, improvements in the economy and labour market translated into better employment outcomes for locals. Local employment grew, fewer residents were retrenched, and citizen median income grew at a faster pace. However, job-skills mismatch continues to be a challenge due to on-going economic restructuring, the changing nature of jobs and shifts in the profile of the resident labour force.
  24. MOM and Workforce Singapore (WSG) will press on with efforts under the Adapt & Grow (A&G) initiative. For PMETs, we will continue to step up outreach efforts through our tripartite partners, sector agencies, and trade associations, while also expanding the range of Professional Conversion Programmes (PCPs). Companies are encouraged to tap on available support under A&G to upgrade and update the jobs and skills of their at-risk employees, and to reskill mid-career new hires to meet their manpower needs.
  25. Rank-and-File workers will receive enhanced wage support under the Place-and-Train programme, while the enhanced Career Trial11 will provide lower- and middle-income workers with more opportunities to try out new careers. Workers in employment are also encouraged to continually refresh their skills to keep pace with new demands as the economy transforms. With more older Rank-and-File workers entering retirement over the next few years, businesses will also increasingly need to focus on upgrading jobs and wages through better productivity and job redesign, in order to attract higher-skilled and younger locals.
  26. Where skills are lacking locally, companies can tap on the Capability Transfer Programme (CTP) to transfer global capabilities to our local workforce. Together with ongoing efforts to enhance the complementarity between our local and foreign workforce, this will help ensure that our workforce remains competitive and adaptable in a vibrant and innovative economy.


  1. Data from Labour Market Report 2017, Manpower Research and Statistics Department, MOM.
  2. Non-seasonally adjusted.
  3. Data from the Labour Market Report 2017, Manpower Research and Statistics Department, MOM.
  4. The annual rates are the simple average of the quarterly rates of re-entry into employment.
  5. Gross monthly income data are from the Labour Market Report 2017, Manpower Research and Statistics Department, MOM.
  6. The Consumer Price Index (CPI) for all items rose by 0.6% in 2017.
  7. Deflated by Consumer Price Index – All Items at 2014 prices.
  8. Data from Annual Economic Survey of Singapore 2017, MTI.
  9. The stronger growth in VA per actual hour worked compared to VA per worker was due to a decline in the number of actual hours worked per worker.
  10. References to labour productivity in this Statement refer to VA per actual hour worked.
  11. Previously called Work Trial.