Josephine Teo on employment numbers: S'pore moving towards 'some light' in the tunnel

Total employment contracted, but not as bad as in 2Q2020.

Sulaiman Daud | October 31, 2020, 11:46 AM

The labour market figures for the third quarter of 2020 (3Q2020) are a mixed bag, befitting an economy slowly recovering from the gravest threat in a generation.

But some signs give cause for optimism, and Minister for Manpower Josephine Teo said she was "quietly relieved" by the advance estimates.

Decline in non-resident employment - why?

Non-resident employment declined more sharply than the rise in resident employment, which contributed to an overall contraction of total employment.

However, the contraction was a "significantly slower pace" than the previous quarter. Excluding foreign domestic workers, the total employment contracted by 26,900 in 3Q, which is bad, but not as bad as the 103,800 job losses in 2Q.

Speaking at a media briefing, Teo explained that repatriations could be behind the non-resident job losses, with workers coming to the end of their contracts, or those who wanted to return home to their families during the pandemic.

Teo also highlighted the strict border controls still in place, in addition to the tightening of work passes.

However, local employment managed to rebound, contributing to the slightly better numbers.

While construction and manufacturing suffered cuts, employment growth in the services picked up, mainly in the Community, Social & Personal Services (e.g. Healthcare and Public Administration), and Food & Beverage Services.

Unemployment numbers rose slightly

Unemployment as a whole still rose slightly, 3.6 per cent overall as compared to 3.4 per cent overall in the previous quarter.

3Q2020 saw 9,100 retrenchments. The number of retrenchments was higher than those recorded during the peak of previous recessions, except the Global Financial Crisis (1Q 2009: 12,760).

But the pace of unemployment's increase had slowed down, Teo noted.

Teo credited this to the collective efforts to save jobs, with workers willing to make sacrifices, employers willing to retrain or redeploy their workers instead of firing them, and the government's move to support and create jobs.

In September 2020, there were 112,500 unemployed residents, of which 97,700 were citizens.

Teo explained unemployment as a pool of job-seekers, which grows when more people seek work, not just when retrenched.

When people stop looking for work whether or not they actually find a job, unemployment shrinks. Teo said:

"For a complete picture, we look at unemployment and employment together. If unemployment is up and employment is down, this is concerning. If unemployment is up and employment is also up, there is still hope. The aim is to bring down unemployment and bring up employment."

What's next?

Teo cautioned that while companies may start hiring people again to replace those that were let go, actually expanding business activities and hiring more people for growth will take more time.

Given the dire global economic situation, retrenchments may continue.

She spoke of a multi-pronged approach to get businesses hiring again.

Economic agencies, the unions and the National Wage Council will do their part to encourage retraining of workers, among other measures.

On the other hand, workers and employers should keep an open mind, adjust their expectations and consider opportunities such as traineeships and attachment programmes.

Teo acknowledged that countries around the world are battling second and third waves of Covid-19 while Singapore looks to open its borders and try to kick-start growth.

"The tunnel is long, there may be twists and turn, but there is some light and we’re moving towards it," she said.

Top image from Josephine Teo's Facebook page.