By Janice Heng, The Straits Times, 1 May 2012
THERE may be more jobs created, but at a slower pace, as Singapore presses on with its productivity drive, said Minister of State for Manpower Tan Chuan-Jin yesterday.
The slower growth is not necessarily bad as long as unemployment also stays low, he added, as he commented on the latest job figures out yesterday.
The Manpower Ministry's (MOM) preliminary estimates reported 27,400 new jobs created in the first quarter of this year. Of these, 19,800 jobs, or seven in 10 new positions, were from the services sector.
Seasonally-adjusted overall unemployment was 2.1 per cent in March, up from 2 per cent in December last year.
Citizen unemployment rose to 3.2 per cent from 3 per cent previously, and resident unemployment went up to 3 per cent from 2.9 per cent. An estimated 59,100 residents, including 52,800 citizens, were jobless in March.
In a post on the ministry's blog, Mr Tan noted the inching up of unemployment in the first quarter and said it will go up slightly.
'As companies begin to adjust and adapt, we will see unemployment going up, albeit slightly, even as our unemployment is still lower compared to other countries.'
This is to be expected, he said, as companies restructure, move overseas or improve their productivity.
Some workers and PMETs (professionals, managers, executives and technicians) will be affected and the tripartite partners will continue to help them move into other jobs and sectors.
But layoffs have eased, with an estimated 2,700 workers made redundant in the first three months of this year, compared to 3,250 in the previous quarter.
Overall, the Government expects unemployment to remain low as it continues to rein in foreign labour growth, said Mr Tan.
'We expect to see many more job vacancies compared to the number of unemployed Singaporean job seekers.'
Mr Tan noted that new job numbers were on the bright side too. He said the services sector is expected to continue to power job creation in 2012, with health-care and childcare services being two areas that will need workers.
Economists interviewed cited other sectors. OCBC economist Selina Ling said the strong increase might reflect ongoing robust momentum in tourism-related and financial services.
Headhunting firm Randstad reported that demand for skilled talent is especially high in the sectors of technology, fast-moving consumer goods, mining and commodities.
There are signs of recovery in the banking and finance sector, particularly for jobs in risk and compliance, as well as front-office roles, it added.
DBS economist Irvin Seah noted that the strong growth in services is due to companies ramping up to meet anticipated stronger demand, with the outlook for the sector remaining good.
Although the overall number of jobs created is smaller than the 37,600 in the preceding three months, Singapore's labour market remains strong, said the economists.
The construction sector added 8,000 jobs.
But manufacturing jobs fell by 500, after falling by 1,400 in the last quarter of last year.
Associate Professor Randolph Tan of UniSIM's School of Business said: 'Given how intimately the fortunes of the manufacturing sector are tied to those of the global economy, it is not surprising to see continued shrinkage there.'
He does not expect things to significantly look up for that sector in the coming year. Manufacturing will face challenges as long as the United States and the euro zone are struggling, he said.
In his blog post, Mr Tan noted that Singapore's economic growth in the past few years was driven by labour growth.
But physical limitations mean that such an approach is not sustainable, he added. 'While we still need foreign manpower, we need to manage its growth and to weigh more of our efforts towards productivity-led growth.'
Economists noted that productivity gains are traditionally hard to make in the labour-intensive services sector.
Yet, slower employment growth bodes well for productivity, said Dr Tan.
Preliminary estimates by the Ministry of Trade and Industry showed that in the first quarter, the services sector grew 6.9 per cent from the previous quarter.
The 19,800 rise in services jobs - an annualised rate of 3.2 per cent - means that productivity, or real output per worker, grew about 3.7 per cent in the first quarter, said Dr Tan.
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