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- The number of workers retrenched rose from 3,690 in Q4 2025 to 3,830 in Q1 2026, mainly in manufacturing, financial services and professional services.
- Unemployment rates remained low, while job vacancies continued to outnumber unemployed persons despite easing from the previous quarter.
- Hiring and resignation rates fell, working hours continued to edge down, and fewer firms expected to hire or raise wages in the coming months.
Retrenchments in Singapore rose slightly in the first quarter of 2026, with the increase concentrated in externally oriented sectors, according to the Ministry of Manpower’s latest Labour Market Report.
The number of workers retrenched increased from 3,690 in Q4 2025 to 3,830 in Q1 2026. While the rise was modest, the report showed that the broader labour market remained stable, with employment continuing to grow and unemployment rates staying low.
The increase in retrenchments was seen mainly in manufacturing, financial services, and professional services — sectors more exposed to external demand and global business conditions. Manufacturing retrenchments rose from 570 to 670, while financial services increased from 510 to 560. Professional services recorded a sharper increase, from 410 to 570.
Business reorganisation or restructuring remained the main reason for retrenchment, accounting for 73.8% of cases, compared with 9.3% attributed to cost-cutting. This suggests that layoffs were driven less by immediate cost pressures and more by companies reshaping their operations and workforce structures.
Despite the increase, the retrenchment incidence stayed low at 1.6 retrenched workers per 1,000 employees, below the non-recessionary norm of 1.7 per 1,000 employees based on the 2014 to 2019 quarterly average.
Still, the impact was not evenly spread across the workforce. Among resident workers, Professionals, Managers, Executives & Technicians (PMETs) continued to face the highest retrenchment incidence across occupational groups. Their retrenchment incidence held steady at 2.6 per 1,000 resident employees between the fourth quarter of 2025 and the first quarter of 2026.
By comparison, clerical, sales and service employees recorded a much lower incidence of 0.7 per 1,000 resident employees, while production and related workers saw their incidence ease from 0.4 to 0.3.
The pattern was also visible by education level. Degree holders saw the most notable increase, with retrenchment incidence rising from 2.6 to 3.1 per 1,000 resident employees — the highest among all qualification groups. This points to restructuring activity remaining concentrated among higher-educated workers, particularly in professional and knowledge-intensive sectors.
Older workers also saw higher retrenchment incidence. Among those aged 50 to 59, the rate rose from 2.8 to 3.1 per 1,000 employees, making it the highest across age groups. In contrast, the incidence among workers aged 40 to 49 declined from 2.5 to 2.3, while younger workers below 30 continued to record the lowest incidence at 0.8.
Short work-week of temporary layoffs
At the same time, firms appeared to be making greater use of temporary work adjustments rather than cutting jobs outright. The number of employees placed on short work-week or temporary layoff rose for the fourth consecutive quarter, reaching 1,230 in the first quarter of 2026. This was up from 620 in the second quarter of 2025, 800 in the third quarter and 960 in the fourth quarter, and marked the highest level since the fourth quarter of 2021.
The increase was driven mainly by construction, where the number rose from 80 to 390, and manufacturing, where it increased from 170 to 260. By occupational group, the rise was concentrated among production and transport operators, cleaners and labourers, where the number increased from 350 to 710.
As in previous quarters, most affected employees were placed on short work-week arrangements rather than temporary layoff. The number on short work-week rose from 680 to 940. Non-PMETs made up the majority, with around 700 placed on short work-week in the first quarter of 2026, reflecting the greater likelihood that hourly-rated workers would have their working hours adjusted during periods of business slack.
Taken together, the figures suggest that more firms are turning to shorter working hours or temporary layoffs to manage fluctuations in manpower demand, rather than resorting to retrenchments. This is also reflected in the steady decline in average weekly paid hours worked per employee, from 43.2 hours in June 2025 to 42.9 hours in March 2026.
Let's take a look at some of the other key findings from the report:
Re-entry prospects improve for retrenched workers
The report also revealed that re-employment prospects for retrenched residents improved in the first quarter of 2026.
The share of retrenched residents who found work within six months rose for the second consecutive quarter, from 55.4% in the third quarter of 2025 to 57.4% in the fourth quarter, and further to 60.7% in the first quarter of 2026. Among those retrenched 12 months earlier, 69.4% had secured new employment, showing that re-entry prospects tend to improve with time.
The improvement was broad-based across occupational and educational groups. Re-entry rates for PMETs rose from 56.4% to 59.6%, while non-PMETs also saw gains. By education level, those with below-secondary qualifications recorded an increase from 51.9% to 57.6%, while degree holders improved from 53.9% to 58.3%.
However, degree holders continued to have lower re-entry rates than some other groups, possibly because those in more specialised or senior roles may take longer to find a suitable job match.
By age, re-entry rates improved for most groups. Workers below 30 saw a sharp increase from 70.8% to 87.1%, while those aged 50 to 59 improved from 45.2% to 51.8%. Workers aged 60 and above continued to record the lowest six-month re-entry rate at 39.7%, though this was up from 37.8% in the previous quarter.
Employment growth continues, but at a slower pace
The labour market continued to expand in the first quarter of 2026, supported by Singapore’s 6.0% year-on-year GDP growth. Total employment rose by 9,400, marking the 18th consecutive quarter of growth since Q4 2021.
However, the pace of hiring slowed from the 17,700-increase recorded in the previous quarter. MOM said this was mainly due to slower non-resident employment growth, particularly in construction and manufacturing.
Resident employment, by contrast, strengthened from 3,100 in Q4 2025 to 5,400 in Q1 2026. Gains were seen in sectors such as administrative and support services, particularly employment activities and travel-related services, as well as transportation and storage and public administration.
Financial and insurance services recorded a decline in resident employment, largely due to fewer self-employed persons in the insurance and related services segment. Employment by financial institutions, excluding self-employed persons, continued to grow.
Employment growth also became less broad-based. The overall Employment Diffusion Index fell from 51.5 in the Q4 2025 to 48.3 in Q1 2026, though it remained above the 43.6 recorded a year earlier. The decline was mainly due to domestic-oriented sectors, where the index fell sharply after the year-end festive period. In contrast, the index for outward-oriented sectors edged up, suggesting some resilience in externally facing industries.
Overall, employment continued to grow, but at a more moderate and uneven pace.
Unemployment remains low and stable
Unemployment rates remained low in March 2026, with the overall rate at 2.0%, resident unemployment at 2.9% and citizen unemployment at 3.1%.
Across age groups, unemployment was largely stable. Workers below 30 saw their unemployment rate rise from 5.8% in December 2025 to 6.2% in March 2026, although their long-term unemployment rate held steady at 1.5%. The increase was mainly among youths below 25 and likely reflected more frequent movement between short-term vacation jobs rather than a wider lack of job opportunities.
Older workers continued to fare relatively well. The unemployment rate for those aged 60 and above stood at 1.8%, extending a broad downtrend since mid-2024. Among workers aged 30 to 59, unemployment rates were stable, ranging from 2.4% to 2.9%.
By education level, unemployment was broadly unchanged for most groups. Degree holders recorded an unemployment rate of 2.9%, while those with below-secondary and secondary qualifications stood at 2.0% and 3.0% respectively. The rate for post-secondary qualification holders rose more noticeably from 2.8% to 3.7%, though MOM noted that this remained within the typical range of variation for the group.
Long-term unemployment also stayed contained. The resident long-term unemployment rate held steady at 0.9%, pointing to continued stability in job prospects. Most age and education groups saw little change, although diploma and professional qualification holders recorded a rise in long-term unemployment from 0.7% to 1.0%.
Overall, the unemployment data suggests that joblessness remains low, with recent movements concentrated mainly among younger workers and those with post-secondary qualifications.
Vacancies ease, but still outnumber jobseekers
Labour demand showed signs of easing, with job vacancies falling from 77,700 in December 2025 to 73,300 in March 2026. The job vacancy rate also declined from 3.1% to 2.9%, and vacancies were lower than the 80,100 recorded a year earlier.
The decline was driven mainly by fewer non-PMET vacancies. However, some sectors continued to see higher demand. Vacancies in financial services rose from 4,300 to 5,800, while manufacturing vacancies increased from 8,000 to 8,500. Vacancies for PMEs and PMETs also rose, reflecting continued demand for skilled workers.
Despite the decline, job vacancies continued to exceed the number of unemployed persons. The ratio of job vacancies to unemployed persons eased from 1.58 in December 2025 to 1.46 in March 2026, suggesting that the labour market remained relatively tight, though less so than before.
Hiring and resignations slow further
Labour turnover continued to ease in the first quarter, pointing to a more cautious labour market.
The average monthly recruitment rate fell from 2.0% in the fourth quarter of 2025 to 1.6% in the first quarter of 2026, while the resignation rate declined from 1.3% to 1.0%. MOM noted that the resignation rate was at a historical low, while the recruitment rate was among the lowest recorded across the years.
This suggests that employers are hiring more selectively, while workers are becoming more reluctant to leave their current jobs amid greater uncertainty. Rather than broad-based weakness in labour demand, the data points to slower churn in a labour market that remains relatively tight.
The decline was seen across several sectors. High-turnover industries such as food and beverage services and retail trade saw resignation rates fall to multi-year lows of 1.8% and 1.4% respectively. Financial and insurance services recorded its lowest-ever resignation rate of 0.6%. Recruitment also softened across most industries, including trade-exposed sectors such as transport equipment manufacturing and land transport and supporting services.
Working hours continue to gradually decline
Average weekly paid hours worked continued their long-term decline in March 2026, though they were broadly comparable with the previous quarter.
Employees worked an average of 42.9 paid hours per week in March 2026, down slightly from 43.0 hours in the previous quarter. Average weekly paid overtime hours also eased from 1.8 to 1.7 hours.
MOM said the longer-term decline in paid working hours was consistent with trends seen in other measures of working time, including actual and usual hours worked. Together with longer-term productivity gains, this points to improved efficiency in the use of working time over the years.
Over the quarter, larger declines in average weekly paid hours were seen in Arts, Entertainment and Recreation, where hours fell from 41.6 to 40.8, and Retail Trade, where they declined from 40.7 to 39.7. Construction also saw a smaller dip from 47.2 to 46.8 hours, but continued to record notably higher working hours than other sectors, likely reflecting project timelines and the physical nature of work in the industry.
In summary, the Q1 2026 figures point to a labour market that remains resilient, but with clearer signs of caution in their hiring and wage plans amid inceased economic uncertainty due to geopolitical tensions.
Firms also appear to be taking a more cautious stance. In March 2026, 44.6% said they expected to hire in the next three months, down from 54.6% in February. Plans to raise wages also pulled back, with 25.4% of firms expecting increases, compared with 39.3% a month earlier.
Retrenchment intentions, however, eased slightly, from 4.4% to 3.6%, suggesting that while firms may be slowing hiring and pay increases, most are not looking to cut jobs.
Lead image / MOM
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