Redundancy and Re-employment, 2009

Incidence of redundancy well below previous recessionary levels

As the economy emerged from the recession, redundancies fell from the record high in the first quarter of 2009 to pre-recession quarterly levels in the last quarter of the year. Despite an increase in 2009, the incidence of redundancy remained well below that in previous recession levels, reflecting the impact of the Resilience Package and concerted tripartite efforts in saving jobs. Re-employment improved after hitting a low in the middle of the year, though re-employment for the year was still lower than in 2008. These are the key findings from the "Redundancy and Re-employment, 2009" released by the Ministry of Manpower's (MOM) Manpower’s Research and Statistics Department.

Redundancies

2. As the economy emerged from the recession, redundancies fell for the third successive quarter to 2,220 in the fourth quarter of 2009, back to pre-recession quarterly levels. A total of 23,430 workers were made redundant in 2009, comprising 20,160 retrenched and 3,270 whose contracts were prematurely terminated. The redundancy was higher than the 16,880 in 2008, due to the large number laid off in the first quarter of 2009 amid the economic downturn. This translated to an incidence of 14 workers made redundant for every 1,000 employees in 2009, higher than the 11 in 2008. This was well below previous recessionary levels of 33 and 26 per 1,000 employees in 1998 and 2001 respectively.

3. There were higher redundancies across the three broad occupational groups in 2009. Production & related workers remained the largest occupational group made redundant, at 11,330 or 48%. Professionals, Managers, Executives & Technicians (PMETs) saw the largest increase from 6,200 in 2008 to 9,570 in 2009 both in absolute and percentage terms. Consequently, their share of redundancies rose from 37% to 41%. The remaining 2,530 or 11% of the workers laid off were from clerical, sales & service positions. Nevertheless, the incidence of redundancy for PMETs (15 per 1,000) remained lower than that for production & related workers (18 per 1,000) but higher than that for clerical, sales & service workers (7 per 1,000).

4. Redundancies in the year rose across the three broad sectors. Nearly six in ten (59% or 13,840) of the workers were from manufacturing. Services contributed another 37% or 8,550, mainly in wholesale trade (10% or 2,430), financial institutions (7.5% or 1,770), professional services (4.7% or 1,100) and transport & storage (4.5% or 1,060). The remaining 4.1% or 950 largely came from construction.

5. Manufacturing had the highest incidence with 36 workers made redundant for every 1,000 employees, significantly more than in services and construction at 8.5 and 4.0 per 1,000 employees respectively. By detailed industries, workers from electronics manufacturing were the most vulnerable (80 per 1,000), followed by those from rubber & plastic products manufacturing (58 per 1,000). Within services, financial institutions (21 per 1,000), wholesale trade (18 per 1,000) and air transport & supporting services (15 per 1,000) registered above-average incidence of redundancy.

6. For the whole of 2009, residents formed 62% of the workers made redundant, about the same as in 2008 (61%) but lower than in 2007 (70%). Non-residents’ share of redundancies (38%) in 2009 was higher than their composition in the workforce (35% as at December 2009).

Re-employment

7. With the economic recovery, re-employment improved after hitting a low in the middle of the year. CPF records showed that 52% of residents laid off in the third quarter of 2009 were re-employed as at December of the year. This re-employment rate (within six months after redundancy) was up slightly from 51% in September 2009, after improving from the low of 43% in June 2009.

8. However, re-employment for the year was still lower than in 2008. Cumulatively, nearly two thirds (65%) of residents made redundant in the first three quarters of 2009 were re-employed by December 2009. For retrenched residents, the cumulative re-employment rate was 65%, lower than 77% in 2008, but comparable to that registered in the previous downturns in 2001 (65%) and 1998 (68%). The deterioration in 2009 over the year was generally felt across the board.

9. The report is available online on the Ministry of Manpower's website. It goes beyond the quarterly reporting to provide additional analysis on the incidence of redundancy, reasons for redundancy, establishments with redundancy, time taken to secure re-employment and the shift in industry among those re-employed.