UNEMPLOYMENT TRENDS MOM
Singapore - The labour market in Singapore has shown signs of a turnaround as total employment grew in the third quarter this year, offsetting losses incurred in the preceding two quarters.
In fact, the latest labour market report released by the Ministry of Manpower revealed that total employment rose by 14,000 last quarter, balancing off losses of -6,200 and -7,700 in the first and second quarter of 2009 respectively, bringing the total employment back to pre-recession levels as seen in December 2008. Employment in the services and construction sectors were hiring more workers at faster rates than their previous corresponding quarters, while the manufacturing sector continued to shed more workers for the fourth consecutive quarter.
However, unemployment rate spotted an increase among the resident labour force, rising from 4.6% in June 2009 to 5.0% in September 2009. Long-term unemployment figures also rose as job seekers needed a longer time to find employment amid cautious hiring sentiments during the downturn. This resulted in the number of resident job seekers who had been looking for work for at least 25 weeks almost doubling from 9,600 in September last year to 18,400 in September 2009.
"In the current environment, it can be difficult for businesses to predict their long-term staffing needs and many have adopted a wait-and-see approach to hiring," said Tim Hird, managing director of Robert Half Singapore. "More firms are hiring on contract / project basis, which allows them optimise their human resource costs during uncertain periods."
This explained the 58.6% decrease in number of workers who were being made redundant from June to September 2009 (2,470), despite the increased long-term unemployment rate. Nevertheless, organisations and job seekers should not be discouraged by the slight increase in the seasonal overall and long-term unemployment rates because based on CPF records, half of the 5,980 residents retrenched last quarter were re-employed by September this year.
At the same time, job vacancies rose for the second consecutive quarter to 34,900 in September 2009, up 42% from June 2009. Although this was still slightly below the 36,000 job vacancies available in September last year, the findings presented a strong indication that more companies were positioning themselves to prepare for the recovery, with more attention focused on hiring people who can add more value in the long term.
As companies gear up for growth in 2010, employers will not only face a major challenge of meeting resourcing demands as the skills shortage deepens, but also more pressure from employees who are expecting to receive pay rises, bonuses, or better compensation packages.
"For companies that are not yet in a position to make salary adjustments or reward staff financially, constant communication of the organisation's rationale, as well as reassurance by management of any future salary revision needs to be a top priority," Hird said. "Employers should conduct one-on-one or group meetings with their employees to discuss the company's goals, as well as reinforce their commitment to retain and groom their key employees"
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