Singapore's employment slows "significantly"

For 2007, Singapore recorded 234,900 new jobs and in 2008, it recorded 227,200. The difference, against the background of the global economic crisis, appears small. But the numbers hide some worrying figures that Singapore must be hoping do not suggest a trend.

For Singapore was still engaging new staff at a rapid rate for the first half of the year, when other parts of the world were already suffering the pains that would later turn into economic agony.

In fact, we saw signs of problems in late 2007, and reported on them in February 2008 (Is Singapore's booming economy holed below the waterline?) saying that our PPPE (Prices, Pay, Property v Earnings) measure was indicating "stormy conditions ahead."

In that article, we concluded "For many, there is a simple question - is Singapore going to keep full employment? For Singaporeans, there is little doubt that it will do its best. But for others, the future is less certain unless they are in highly skilled positions."

And that is already coming true. The internet chat rooms are abuzz with word that in November last year, the mighty Singapore Airlines started declining to renew its generous Expat Pilots packages when contracts came to an end - offering those who wanted to stay local terms (which, it has to be said, are not too shabby). Then came the news in December that SIA Cargo was putting some of its pilots on unpaid leave as the cargo industry fell apart. Cargo ships were moored at anchor with no-where to go, in the case of one company, several of its ships all lined up in a row.

The MoM figures show the reality of the picture: although the total number of persons employed has continued to rise, the rise has fallen away dramatically during the latter half of 2008. The report says "The slowdown was felt across many industries, led by manufacturing where employment fell by 6,200 in the fourth quarter of 2008, its first contraction since the third quarter of 2003. "

Singapore's strategic sectors fared a little better - but not much. "Nevertheless, job gains slowed considerably in the fourth quarter (21,900) from a year ago (38,500), mainly weighed down by financial services, transport & storage and business services. With brisk building activities, construction workforce grew strongly by 64,100 in 2008, up from the gains of 40,400 in 2007; although growth also moderated in the fourth quarter with 10,800 workers added compared with quarterly gains of 14,500 to 22,400 in the preceding 3 quarters."

In the earlier article, we pointed out the tendency of the Chinese, who form the majority of Singapore's population, to spend their way into a recession. And that seems to have happened in the early part of 2008: "Due to the strong demand for workers earlier in the year, foreign employment rose by 156,900 in 2008, up from 144,500 in 2007. As the economic downturn deepened, the employment growth slowed significantly for both locals and foreigners in the last quarter of the year. As at December 2008, there were 1,057,700 foreigners forming 36% of the 2.96 million persons employed in Singapore. The majority comprising 64% or 1.90 million of the workforce were locals."

But it was in redundancy (which Singapore calls "retrenchment" that the fear over trends comes home hardest: "Preliminary estimates show that 7,000 workers were retrenched in the fourth quarter of 2008, up substantially from 2,346 in the previous quarter and 1,966 in the same quarter a year ago. The number of workers retrenched in manufacturing more than doubled from 1,709 in the previous quarter to 3,700. Driven by layoffs in financial services and wholesale trade, retrenchments in services increased by more than four fold to 3,200 from 562 in the earlier quarter."