Labour Market Continues Expansion in First Quarter 2024, Despite Global Economic Risks
The Labour Market Advance Release for the first quarter of 2024, released on April 30, 2024, paints a picture of continued expansion, albeit at a moderated pace, reflecting ongoing global economic uncertainties. Despite these challenges, the Singaporean labour market showed resilience, with total employment (excluding Migrant Domestic Workers) experiencing growth, primarily driven by an increase in resident employment. Retrenchments also saw a decline for the second consecutive quarter, indicating stability despite prevailing global risks.
Key Findings
Total employment in Singapore increased by 4,900 in the first quarter of 2024, a slight decrease from the previous quarter’s growth of 7,500. However, the growth was predominantly supported by an upsurge in resident employment, signaling positive momentum akin to non-recessionary periods. Conversely, non-resident employment contracted for the first time since the third quarter of 2021, largely due to cooling labour demand.
The rise in resident employment was particularly notable in sectors such as Financial Services, Health & Social Services, and Public Administration & Education. This growth offset seasonal declines in sectors like Retail Trade and Food & Beverage Services following the festive period.
On the other hand, the decline in non-resident employment, especially in sectors like Construction, underscored adjustments made by businesses in response to policy changes, such as the reduction in the sector’s Dependency Ratio Ceiling.
Retrenchments, a critical indicator of labour market stability, fell to 3,000 in the first quarter of 2024 from 3,460 in the previous quarter. Business reorganisation and restructuring remained the primary reasons for retrenchments, reflecting ongoing efforts by businesses to adapt and transform.
While unemployment rates experienced a slight uptick in March 2024, they remained within pre-pandemic ranges. Anticipating this increase due to higher retrenchments in the preceding quarters, analysts do not expect sustained rises in unemployment rates, given the ongoing tightness in the labour market.
Looking Ahead
The Ministry of Trade and Industry’s advance estimates suggest an improving economic outlook for 2024. This should correspondingly strengthen labour demand. Forward-looking polls indicate increased hiring intentions among firms, albeit with a potential slowdown in wage improvements.
With a focus on sustaining economic growth and fostering resilience, the government emphasizes the importance of business transformation and workforce upskilling. Initiatives such as Workforce Singapore’s Career Conversion Programmes and Mid-Career Pathways Programme offer support for workers to reskill and adapt to evolving job demands. Employers are encouraged to leverage resources such as Jobs Transformation Maps (JTMs) to redesign jobs and enhance productivity.
Conclusion
Despite global economic uncertainties, Singapore’s labour market demonstrated resilience continuing its expansion in Q1 2024, . With efforts from both government and industry stakeholders, the aim is to navigate challenges, sustain economic growth, and create better job opportunities.
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