Labour Market, 2007
Another record-breaking year for job creation
The robust economic performance led to another record-breaking year for employment creation. Employment rose by a record 234,900 or 9.4% in 2007, far surpassing the gains of 176,000 or 7.6% in 2006. Local employment grew by 90,400 in 2007, comparable to the record 90,900 gains in 2006. Foreigners increased by a new high of 144,500, up from the gains of 85,100 in 2006, enabling the economy to grow beyond the limits of Singapore's indigenous workforce. As at Dec 07, there were 900,800 foreigners forming one in three (33.0%) of the 2.73 million persons employed in Singapore.
2. Supported by the robust job creation, the unemploymentp rate dropped to the lowest in a decade. The seasonally adjusted overall and resident unemployment rates declined to 1.6% and 2.3% in Dec 07, from 2.6% and 3.6% respectively a year ago. An estimated 45,200 residents were unemployed in Dec 07. The seasonally adjusted figure was 45,600.
3. Structural unemployment also fell amid the robust employment growth. The resident long-term unemployment rate reached a ten-year low1 of 0.4% in Dec 07, down from 0.8% a year ago, as the number of residents who had been looking for work for 25 weeks or more fell to 8,900 from 15,100. The share of long-term unemployed residents among the pool of resident job seekers eased to 20% in Dec 07 from 22% a year ago.
4. The number of workers retrenched in 2007 fell by 39% from 12,603 in 2006 to a 14-year low of 7,675 in 20072. Based on CPF records, two thirds of residents retrenched in the private sector secured re-employment within 6 months after retrenchment in 2007. This is the highest re-employment rate recorded since 1997.
5. There were 37,400 job vacancies in Dec 07, higher than 32,000 in Dec 062. These unfilled posts represented 2.5% of manpower demand3, up from 2.3% a year ago. With the rise in job vacancies and low unemployment, the seasonally adjusted ratio of job vacancies to unemployed persons hit a decade-high with 138p job openings for every 100 job seekers in Dec 07, a sharp improvement from 79 in Dec 06.
6. Nominal earnings rose over the year by 6.2% in 2007, up from 3.2% in 2006, but lower than 8.9% during the last economic boom in 2000. After accounting for inflation, the growth in real terms was 4.0% in 2007, 2.2% in 2006 and 7.5% in 2000.
7. For the whole year of 2007, productivity shrank by 0.9% after experiencing slowing growth in the preceding two years (1.5% in 2006 and 2.8% in 2005). The last time productivity had contracted was during the economic downturn in 2001. This time round, while there was healthy output growth, it failed to keep pace with the record increase in manpower. Following the contraction in productivity, the overall unit labour cost (ULC) rose for the third straight year. The increase in ULC of 3.8% in 2007 was higher than the 0.5% in each of the preceding two years but less than 6.5% during the economic downturn in 2001.
8. In summary, the strong economy has led to another record-breaking year for employment creation in 2007. This has brought down unemployment rate to a decade low and boosted growth in workers' earnings. However, productivity has contracted in the year as the growth in output has not kept pace with the record increase in manpower.
For More Information
9. The report is available online on the Ministry of Manpower's website.
1 For December periods.
2 Data pertain to private sector establishments (each with at least 25 employees) and the public sector.
3 Total manpower demand is the sum of the number of employees and job vacancies.
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FACTSHEET
Singapore – Expanding Economy, Creating Jobs
Singapore stands out among both developing and advanced economies, in being able to achieve strong employment growth in tandem with strong GDP growth. While employment growth in other advanced economies typically cluster around 3% or lower, Singapore had achieved very strong employment growth of 9.4% last year and 7.6% the year before.
2. This is best captured by a chart which shows how Singapore's GDP and employment growth fared against developing countries – Malaysia and China – as well as advanced economies – UK, US, Hong Kong, Japan between 2001 and 2006.
3. Screenshots of dynamic charts are available for download. (Still shots)
4. In 2001 and 2002 when Singapore was hit by a recession and was recovering from it, Singapore's GDP growth was low and employment growth was negative. In subsequent years as the economy recovered, employment grew strongly, faster than both developing and advanced economies.
5. Singapore's performance is the result of our flexible labour market policies which has helped the economy grow and created more than sufficient jobs for Singaporeans, including new entrants into the labour market.