Labour Market Report First Quarter 2022
Overview
1. The labour market continued to improve on all fronts in 1Q 2022. Resident employment has grown beyond pre-pandemic levels (3.9% higher than in December 2019). Unemployment rates continued to trend down to pre-pandemic levels (overall: from high of 3.6% to 2.2%, resident: from 4.9% to 3.0%, citizen: from 5.0% to 3.1%). Although the resident long-term unemployment rate remained above the pre-pandemic level (0.8% vs. 0.7%), this too has improved. The number of retrenchments (1,320) dipped to a record low, and a higher re-entry rate (72%) was observed among residents, six months post retrenchment. Resignation (1.7%) and recruitment rates (2.5%) have also remained stable this quarter, after trending up in the previous quarters.
2. Relatedly, job vacancies (128,100) increased to a new high, though the rate of increase has slowed. With the significant relaxation of border restrictions from April 2022, we expect non-resident worker inflows to recover, which will alleviate labour shortages in the months ahead. At the same time, the Government will continue to support businesses to strengthen local hiring and pursue transformation, so that they can remain competitive.
Main Findings
Resident employment exceeded pre-pandemic levels, but total employment remained below pre-COVID levels due to non-residents
3. Total employment continued to expand by 42,000 (excluding Migrant Domestic Workers) in 1Q 2022. Most of the total employment increase in 1Q 2022 were from non-residents (36,000), as border restrictions were progressively lifted and employers back-filled vacancies for jobs that are more reliant on migrant workers. While resident employment has grown (3.9%) above pre-pandemic levels, non-resident employment in March 2022 remained 15% below December 2019.
4. Resident employment trends were mixed across sectors. Resident employment continued to rise in growth sectors such as Financial Services, Information & Communications, Professional Services, and Health & Social Services. On the other hand, it declined in consumer-facing sectors, mainly due to the seasonal pattern of temporary workers hired for year-end festivities leaving in the following quarter.
Unemployment rates stayed low, and resident long-term unemployment rate improved
5. Unemployment rates trended lower over the month for citizens in April 2022 (from 3.2% to 3.1%), and held steady at its pre-pandemic levels for residents and the overall labour force (3.0% and 2.2% respectively). Between December 2021 and March 2022, the resident long-term unemployment rate also improved (from 1.0% to 0.8%), but remained slightly above the pre-COVID quarterly average of 0.7% in 2018/19.
Retrenchments fell to a record low
6. The number of retrenchments declined, from 1,500 (or 0.7 retrenched per 1,000 employees) in 4Q 2021 to 1,320 (or 0.6 per 1,000 employees) in 1Q 2022. Among retrenched residents, the percentage who re-entered employment within 6 months post retrenchment rose (from 67% to 72%) to a high last seen in 2015.
7. As business activities resumed and manpower shortages rose, employers placed fewer employees on a short work-week or temporary layoff. The level in 1Q 2022 (670) was now below the pre-COVID norm (quarterly average of 740 in 2018/19).
Job vacancies rose to a new high
8. The number of job vacancies also continued to rise, reaching a new high of 128,100 in March 2022. However, the rate of increase (9%) slowed compared to the previous quarter (17%). The ratio of job vacancies to unemployed persons (2.42) also increased to its highest since 1998, due to a decline in unemployed persons and increase in vacancies.
9. The bulk of the job vacancies were in Construction and Manufacturing (mainly for non-PMET job roles typically held by migrant workers), as well as in Financial Services, Information & Communications, Public Administration & Education and Professional Services (mostly PMET vacancies).
Recruitment and resignation rates held steady
10. The recruitment and resignation rates were unchanged in 1Q 2022 at 2.5% and 1.7% respectively, after trending up in previous quarters. By occupation, PMETs experienced greater churn. Their recruitment and resignation rates have been creeping up, and were now above their pre-COVID averages. Nonetheless, the rates in 1Q 2022 were still below record highs. By industry, Information & Communications, Financial Services, Health & Social Services, Transportation & Storage and Accommodation experienced higher turnover.
Conclusion
11. With the significant relaxation of border restrictions, we expect the non-resident workforce to continue to recover, catching up with the strong resident employment growth over the past two years. This will provide some relief to the current labour market tightness. At the same time, the deterioration of the external economic environment, due in part to the Russia-Ukraine conflict, has weakened the demand outlook for some of our outward-oriented sectors. This may in turn cool labour demand going forward. As such, firms should press on with restructuring and transformation to maintain their competitiveness. The Government will continue to support our firms to do so, while at the same time upskilling local workers for new jobs. Specifically:
a. The Jobs Growth Incentive (JGI) provides salary support for eligible employers to expand local hiring. It has supported close to 600,000 local hires by 74,000 firms between September 2020 and November 2021. We have extended the JGI to September 2022, covering mature hires who have not been in work for at least six months, persons with disabilities, and ex-offenders. Eligible employers can receive up to $21,600 per hire over a 12-month period.
b. The SGUnited Mid-Career Pathways Programme (SGUP) offers attachment opportunities for mid-career jobseekers. From its launch until January 2022, more than 7,200 locals have been placed into attachments, each receiving up to $3,800 in training allowance. This allows employers to better assess the job-fit of mature jobseekers, while providing them with training and industry experience.
c. Employers can tap on the Support for Job Redesign under Productivity Solutions Grant to improve job quality and attractiveness to workers. WSG also offers Job Redesign Reskilling Programmes to support employers in upskilling existing employees to take on enhanced job roles.
d. Jobseekers who require career matching services, including those in short-term COVID roles looking for full-time opportunities, can approach WSG and NTUC’s Employment and Employability Institute.
For More Information
12. The “Labour Market Report, First Quarter 2022” is released by the Manpower Research and Statistics Department, Ministry of Manpower. The report and technical notes on the various indicators are available at https://stats.mom.gov.sg/.