Advanced estimates from the Manpower Ministry (MOM) on 31 January 2024 showed that retrenchment numbers hit 14,320 in 2023 – more than double compared to 2022.
MOM said the majority of the retrenchments were due to business reorganisation or restructuring.
While employment did grow in 2023 for both residents and non-residents, the pace of growth slowed in each successive quarter amidst weaker economic conditions.
The ministry expects employment to continue to grow at a slower pace in 2024, as labour demand eases.
NTUC Assistant Secretary-General Patrick Tay shared his concerns that ongoing challenges and uncertainties will contribute to unemployment number in 2024, with continued volatility and disruption affecting retrenchment numbers.
He said: “I am particularly concerned for the Electronics Manufacturing sector as cyclical/global demand forces continue to dampen optimism for the industry.
“I look forward to the first half 2024 figures before we can accurately forecast a better second half of 2024 for this sector.”
Total employment, excluding Migrant Domestic Workers, increased for the ninth consecutive quarter, expanding by 8,400 in 4Q 2023.
However, the growth rate slowed significantly for both residents and non-residents compared to previous quarters, aligning with cooling labour demand indicators.
MOM said the slow rate of growth “was not unexpected,” as weaker hiring expectations and declining job vacancies from preceding quarters showed signs of cooling labour demand.
Resident employment growth was observed in health and social services, public administration and education, retail trade, and F&B services. This was likely due to seasonal hiring.
After the robust rebound post-pandemic in 2022, the total employment growth in 2023 was more moderate due to challenging economic conditions.
Unemployment rates remained steady in December 2023, with the overall rate at 2.0 per cent, resident rate at 2.8 per cent, and citizen rate at 2.9 per cent.
Retrenchments declined to 3,200 in 4Q 2023, down from 4,110 in the previous quarter.
While the electronics manufacturing sector saw an increase in retrenchments, other sectors remained stable.
Business reorganisation or restructuring remained the primary reason for retrenchments, particularly in outward-oriented sectors such as wholesale trade, IT services, and electronics manufacturing.
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