Labour Market Advance Release - First Quarter 2024
Overview
1. Advance estimates showed that the labour market continued to expand in 1Q 2024, albeit at a moderated pace relative to previous quarters. This continues the trend of cooling labour demand in 2023, as downside risks in the global economy remain. Nevertheless, total employment (excluding Migrant Domestic Workers) growth increased in the first quarter amidst moderate tightness in the labour market, driven wholly by an increase in resident employment as unemployment rates remained low. At the same time, retrenchments also declined for the second consecutive quarter.
Main Findings1
Total employment grew due to residents in 1Q 2024
2. Total employment grew by 4,900 in 1Q 2024, lower than the previous quarter (7,500). The employment growth this quarter was wholly supported by an increase in resident employment. This increase in resident employment was higher than that in the previous quarters in 2023, and was comparable to resident employment growth in non-recessionary periods. Non-resident employment contracted for the first time since 3Q 2021 due to cooling labour demand. Nevertheless, applications for higher-skilled non-residents, i.e. Employment Pass holders, have picked up in tandem with improved business expectations.
3. The increase in resident employment was mainly in growth sectors such as Financial Services and Health & Social Services, as well as Public Administration & Education. Employment growth in these sectors outweighed the seasonal declines in Retail Trade, Food & Beverage Services and Accommodation following the end of the festive period.
4. The decline in non-resident employment was mainly in Construction (mostly Work Permit holders), which accounts for a significant proportion of Work Permit Holders. Employment in the sector fell for the first time since 4Q 2021, as Construction firms adapted to the reduction in the sector’s Dependency Ratio Ceiling from 1:7 to 1:5, with effect from 1 January 2024. Smaller declines were also seen in outward-oriented sectors such as Manufacturing and Information & Communications.
Retrenchments fell for the second consecutive quarter
5. Retrenchments fell for the second consecutive quarter to 3,000 in 1Q 2024 from 3,460 in 4Q 2023. Business reorganisation/ restructuring remained the top reason for retrenchments in 1Q 2024, as businesses press on with transformation efforts.
Unemployment rates remained within the pre-pandemic range
6. Unemployment rates edged up slightly in March 2024 (overall: 2.1%; residents: 3.0%; and citizens: 3.1%), but remained within the range observed during non-recessionary periods2. The increase was not unexpected — we had previously highlighted that unemployment rates could edge up amid higher retrenchments in 3Q and 4Q 2023. However, we do not expect sustained increases in unemployment rates, given continued labour market tightness.
Conclusion
7. MTI’s advance estimates showed that our economy is expected to improve in 2024. Labour demand, which tends to lag economic growth, should strengthen correspondingly. MOM’s forward-looking polls also suggested improved hiring demand, with 50.7% (up from 47.7%) of firms indicating an intention to hire in the next three months. However, wage improvements could slow, as the proportion of firms with an intention to raise wages declined from 32.6% to 26.1%.
8. With slowing resident workforce growth and low resident unemployment rates, it will be less likely for resident workforce growth to sustain our economic growth. Instead, MOM, together with economic agencies, will help our businesses press on with transformation to become more manpower-lean and productive, generating better jobs for Singaporeans in the workforce and resources for national development. To achieve this, it is imperative that Singapore continues to attract highly-skilled foreign workers that complement our resident workforce and help our businesses and economy to compete and to thrive.
9. The Government calls on employers and workers to make full use of available programmes to remain competitive and resilient amidst economic uncertainty. Workers should continue to upskill and be open to new opportunities. Employers should press on with business transformation and equip their workers for expanded or redesigned job roles.
a. Workforce Singapore (WSG) offers several initiatives that can help resident workers reskill for new job roles, such as the Career Conversion Programmes which support mid-career workers to undergo industry-recognised training with up to 90% salary and course fee support. In addition, WSG’s Mid-Career Pathways Programme provides attachment opportunities to mature workers, allowing them to widen their professional networks and gain industry-relevant skills and experience while receiving a training allowance of up to $3,800 per month.
b. Jobseekers who require additional assistance can tap on career matching services offered by WSG and NTUC’s Employment and Employability Institute.
c. Employers can refer to the Jobs Transformation Maps (JTMs) to understand how their businesses and job demands may change in response to sectoral trends. A total of 17 JTMs are available on WSG’s website, and three more will be progressively completed. The JTMs identify the key technologies that are impacting individual job roles and employers could use the JTMs to pre-emptively redesign jobs and reskill their workers for jobs of the future.
d. Employers are also encouraged to tap on the Support for Job Redesign under Productivity Solutions Grant, to make their jobs more productive and attractive to jobseekers.
10. The Labour Market Report First Quarter 2024, due for release in mid-June 2024, will provide a comprehensive assessment and more details of the labour market situation in 1Q 2024. This will include the breakdown of resident and non-resident employment3, sectoral breakdowns, number of job vacancies, labour turnover, and re-entry rates among retrenched residents.
For More Information
11. The report is available online on the Ministry of Manpower’s Research and Statistics Department website at stats.mom.gov.sg.
12. For data requests and queries pertaining to the report, please reach out to the Ministry of Manpower’s Research and Statistics Department at mom_rsd@mom.gov.sg.