Job growth slows but bosses still keen to hire

Fewer people laid off; citizens' jobless rate at lowest level since March 2011

By Janice Heng, The Straits Times, 1 Nov 2013

FEWER jobs are being created but employers are still hungry for workers, according to latest official figures.

In all, 28,100 new jobs were added in the third quarter, down from an employment growth of 33,700 in the previous three months.

Also, fewer people are being laid off which, in turn, has helped the unemployment rate to decline.

The seasonally adjusted rate slipped to 1.8 per cent in September, from 2.1 per cent in June. For citizens, it fell from 3.1 per cent to 2.8 per cent - the lowest since March 2011.

It might seem that an initial sign of relief in these preliminary figures, released yesterday by the Manpower Ministry, is the slower pace of growth of new jobs.

In August, Acting Manpower Minister Tan Chuan-Jin worried that companies were "still relying too heavily on labour".

But the pace may not have slowed sufficiently as job growth was still higher than in the same period last year.

Total employment is up 4.1 per cent from a year ago, as the number of people at work rose to 3.45 million.

The increase is faster than the target 1 per cent to 2 per cent rate the Government had set for the decade, as it wants companies to fuel their growth with higher productivity and lower manpower.

But restructuring takes time, said Barclays economist Joey Chew. "We shouldn't be scrutinising quarterly numbers for dramatic changes," she added.

As usual, job growth was led by the service and construction sectors. Both added more workers than in the same period last year.

In contrast, manufacturing added only 3,000 jobs, down from 3,700.

Meanwhile, fewer workers lost their jobs between July and September. In all, 2,600 were made redundant, down from 3,080 in the previous three months and 2,850 in the same period last year.

The main reason for the downtrend is the fall in layoffs in manufacturing. It shed 1,000 workers, compared with 1,630 in the previous quarter. This more than made up for a small rise in service sector layoffs: from 1,190 to 1,300.

These figures, which indicate a continuing tight labour market, come two days after the Monetary Authority of Singapore said wage rises this year and next year were expected to be higher than the historical average of 3.3 per cent.

Economists agree.

"With labour demand that robust and the Government's various measures for the foreign workforce still very much in place, it is not hard to imagine the upward pressure on domestic wages to retain staff and to attract new employees," said UOB economist Alvin Liew.

But OCBC economist Selena Ling noted that not all jobs may benefit: "The wage growth will probably be skewed towards industries with the greatest manpower shortage and/or niche skills, such as nurses, teachers and the financial sector."

Recruiters are optimistic.

Adecco Singapore expects fresh graduates to find it easier to get jobs as many large multinationals are "in hiring mode again", while Randstad expects those with specialist skills in banking and finance, life sciences and technology to be highly sought after.