Look Ahead 2023: With a weaker job market looming, youth cannot afford to be choosy and should upskill, say experts

SINGAPORE — Although university student Aida will graduate here only in December 2023, the political science major with a minor in the Korean language is already preparing to apply for a job in the middle of the year.

The 22-year-old, who asked to go by one name, hopes to work as a Korean translator or interpreter for a non-governmental organisation that helps North Korean refugees. 

While she is largely confident that she can secure this role, she does have some concerns. 

For one thing, with borders opening up and people from other nationalities who may have more experience speaking Korean possibly vying for her job, she feels the pressure to hone her skills. 

"These days, it isn't enough to simply have a second language, and many have to take on a third and a fourth," she said. 

"I started learning the Chinese language because of this concern." 

She added that should the economy falter in 2023 and leave demand for her role weak, she is also willing to work in a range of translation roles, such as being an interpreter for the Government, or teaching English to Korean children.

Ms Aida's concerns are not unfounded.

Economists have warned that the job market will not be as rosy as it was in 2022, with economic growth projected to be slower in 2023 and foreign labour inflows expected to increase, easing the tightness in the labour market.

Recent retrenchments in the technology sector, as well as a slump in manufacturing, have also dampened job prospects in these fields. 

Economies around the globe are feeling the impact of rising inflation, and the resultant moves by many central banks to raise borrowing costs in a deliberate move to slow economy activity to bring down prices.

Thus, fresh graduates and young job seekers should be alive to these changes, and cannot afford to be too choosy when it comes to their job search as they could last year, human resource (HR) experts said. 

OVERALL OUTLOOK

• Singapore’s economic growth is tipped to slow from 3.8 per cent last year to 2 per cent or even less in 2023, OCBC's head of research and strategy Selena Ling said. She added that are also "growing global recession concerns and slowing demand conditions"
• "The local job market is likely to remain stable, but hiring intentions and wage expectations may be less buoyant compared to 2022," she said 
• In addition, senior economist Irvin Seah from DBS bank said that expectations of an increased inflow of foreign manpower, especially in the wake of China's move away from its Covid-zero policy, will further ease the tightness in the labour market 
• The Labour Market Report for the third quarter in 2022 released last month by the Ministry of Manpower showed that labour market tightness had eased and is expected to continue easing as job vacancies decline
• "There are some signs that the momentum of improvements in the labour market could slow in the quarters ahead," the report said

Despite the economic shifts, the number of retrenchments is not expected to spike, Mr Seah said. 

"The risk (of rising retrenchments) is still low at this juncture, unless Singapore heads into a recession, which is unlikely in 2023." 

As for salary growth, Mr Seah expects this to reflect the economic outlook. 

"With economic growth momentum slowing down and the labour market softening, the easing in labour market tightness will obviously prompt moderation in wage growth as well." 

However, the outlook on salaries is mixed. A survey by financial services firm Mercer released in November found that the average pay rise in Singapore is expected to reach 3.75 per cent in 2023, higher than the 3.65 per cent seen in 2022.

WHAT CAN YOUNG JOBSEEKERS DO?  

Human resource experts said that the same lessons that fresh graduates and young jobseekers learnt during the height of the pandemic should also apply to the coming year. 

Ms Carmen Wee, founder of human resource advisory services firm Carmen Wee & Associates, said: "For incoming fresh graduates... the assumptions that we made during the pandemic about being aware of one's skills, being prepared for interviews and having a career strategy, all these things are still relevant." 

Agreeing, Mr Adrian Choo, career strategist and founder of Career Agility International, said that it is up to jobseekers to look for upskilling opportunities for in-demand sectors, such as what Ms Aida had done in learning the Chinese langauge. 

This could be achieved by attending government-subsidised courses using SkillsFuture Credit, for example.

"You have to keep evolving your skills to where the demand is or is going to be," he said.

For instance, while technology and manufacturing have been struggling, sectors such as hospitality and retail are expected to do well this year. Certain skillsets that are needed across industries, such as those in marketing roles, will also be in demand. 

"If you are in an industry that is declining or stagnating, try to pivot to something that’s faster growing," he said. 

HOW WILL THE TECH SECTOR FARE? 

With layoffs in tech last year signalling a slowdown in the sector, human resource experts said that that the sector will "continue consolidating" in 2023. 

Mr Choo from Career Agility International said: "Now that everyone is going back to face-to-face interactions, and social media (is) dropping in significance, the tech market is still facing an uphill climb." 

Agreeing, Mr Seah from DBS said that 2023 will see a "reversal" of what happened during the Covid-19 period — whereas industries such as hospitality and retail were badly hit while the tech sector boomed during the height of the pandemic, the reverse has happened as the pandemic situation improves. 

"Sectors that did well in pandemic are now slowing down and struggling." 

However, it is not a signal for those working in tech to jump ship. 

Ms Wee from Carmen Wee & Associates said that the challenges that the tech sector is undergoing will not be long-term. 

"Every industry is going digital, every industry is going to automate, so tech is still a very long-term, viable play, so it is just a matter of timing," she said. 

WHAT WILL CHINA'S REOPENING ENTAIL?

China's move away from its Covid-zero policy could mean an influx of foreign Chinese labour in 2023, which could ease the tightness in the labour market. 

"Before Covid-19, quite a sizeable portion of our labour force was from China, so you could expect more Chinese workers coming to Singapore going forward and that would fill up the existing vacancies currently in the labour market," Mr Seah said. 

However, while there could be an influx of labour from China, the economic giant could also generate demand such as from tourism and exports, which could in turn create more jobs in Singapore. 

"With the Chinese market opening up, demand is going to explode, and this offers more opportunities than threats," Mr Choo said. "More business is good for companies in Singapore, so there may be more hiring."