SINGAPORE — Resident employment has recovered to almost pre-pandemic levels, the Ministry of Manpower (MOM) said, but the long-term unemployment rate has also risen. The long-term unemployment rate is the proportion of residents in the economy who have been jobless for at least 25 weeks or six months.

In its latest Labour Market Report released on Thursday (Dec 17), MOM said that between July and September, resident employment grew strongly, with 43,200 workers added back to the labour pool.

The strong increase in resident employment in the third quarter helped to offset most of the declines in the first two quarters of the year, MOM said.

Resident employment stood at 2.34 million in September, just 0.4 per cent lower than in the same month last year.  

Non-resident employment, excluding foreign domestic workers, declined by 73,200 in the third quarter to 1.02 million — sharper than the falls seen in the first two quarters of the year. 

As a result, total employment in Singapore continued to contract in the third quarter of the year, with nine out of 10 of the job losses affecting non-residents.

From January to September, the total number of people employed, excluding foreign domestic workers, fell by 158,700.

Of the 158,700, 139,100 were non-residents, while resident employment dropped by a significantly slimmer margin of 19,600.

LONG-TERM UNEMPLOYMENT RATE ‘BEARS CLOSE WATCHING’

Despite the strong growth in employment, there were also more long-term unemployed residents, MOM said. There were 22,000 people in September who had been jobless for at least 25 weeks, up from 18,600 in June. 

This means that the long-term unemployment rate for residents rose to 0.9 per cent in September, up from 0.8 per cent in June, a trend that MOM said “bears close watching”. 

At the same time, the unemployment rate for residents rose from 3.8 per cent in June to 4.8 per cent in October.

Asked during a media briefing why the strong rebound in resident employment could not offset the increase in unemployment, Mr Aubeck Kam, Permanent Secretary for Manpower, said that it could be because some people who had previously decided to stop job-hunting are now returning to the labour market.

“Some people who have previously taken a time out, and they thought (they) should not enter the job market yet because there were not enough opportunities of interest, now that they see the economy getting back on its feet, they are returning to the labour market to be jobseekers,” he said.

For the first time this year, the number of job vacancies rose in September.

MOM said there are indications that the labour market is picking up: 

• The number of employees who were placed on a short work week or temporarily laid off in the third quarter (34,240) halved from the second quarter (81,720)

• Average paid hours worked rose from 43.4 hours a week in June 2020 to 43.8 hours in September, reflecting higher overtime hours

• The number of job vacancies rose for the first time this year to 49,600 in September, resulting in an improvement in the job-vacancy-to-unemployed ratio, from 0.57 to 0.6 over the quarter.

However, MOM noted that the uncertainty in the economic environment, coupled with weak demand conditions, will continue to weigh on the recovery of the labour market.

“The labour market tends to lag development in (gross domestic product) growth,” Mr Kam said. “So if the economy recovers, the labour market will likely recover, but at a delayed pace, because initially, employers will have a lot of excess capacity. Even as demand comes back, they are not necessarily needing to go and hire in large numbers.” 

He added that Singapore’s job-vacancy-to-jobseeker ratio is still low, at below one. 

“So I don’t think one ought to think that the whole battle is already won and we don’t have to worry anymore.”