The unemployment rate in Singapore is now at its highest point in 10 years, with the economy starting to feel the effects of the Covid-19 outbreak.

Jobless rate highest in 10 years

According to the latest labour market report from the Ministry of Manpower, seasonally adjusted unemployment rates rose in March 2020 from December 2019, which is 2.3 per cent to 2.4 per cent overall.

The unemployment rate for Singapore citizens rose from 3.3 per cent to 3.5 per cent, while it rose from 3.2 per cent to 3.3 per cent for residents, who are both Singapore citizens and permanent residents.

In terms of numbers, 67,100 citizens were unemployed in March 2020, as compared to 63,500 in December 2019.

The service sector saw the sharpest decline, as consumer-dependent F&B services, retail trade and tourism-dependent accommodation were most severely affected by the pandemic.

Jobless rate still lower than peak of SARs

Jobless rates of these levels were last seen in December 2009, when unemployment rates were at 2.3 per cent.

But the current rate remains lower than the heights seen during SARs (4.8 per cent overall) and the Global Financial Crisis (3.3 per cent overall).

More retrenchments than previous quarter

Overall retrenchments in the first quarter of 2020 (3,000) were also higher than the previous quarter (2,670).

But the levels remained lower than the quarterly peak during the Global Financial Crisis (12,760).

Jobs and wage support measures, as well as the encouragement of companies to retain workers and retrench only as a last resort, have generally held back the number of layoffs, MOM said.

Local employment grew at a "modest pace"

Despite difficulties since the start of the Covid-19 outbreak, local employment still managed to grow at a modest pace.

This is because contractions in wholesale and retail trade, food and beverage services and accommodation were buffered by increases in healthcare, public administration and professional services.

Pressure on labour market to continue

But MOM cautioned that Singapore will continue to see continued pressure on the labour market.

From weekly polls conducted, the number of companies who indicated an intention to reduce headcount or salary in the next two months has rose slightly, although those who no intention to do so still remained the majority.

You can read the entire report here.

Top image via Suhaimi Abdullah/Getty Images