MOM report: 94.5% of 2023 employment growth in Singapore goes to foreigners

Source: Gutzy Asia
Author: Yee Loon

SINGAPORE: The Ministry of Manpower (MOM) unveiled the latest employment data on Thursday (14 March), offering insights into Singapore's workforce dynamics throughout 2023.

Despite the ebbs and flows of the economy, Singapore witnessed a notable surge in total employment, boasting an increase of 88,400 (excluding migrant domestic workers) positions over the year.

This growth, however, was juxtaposed with a significant spike in retrenchments, more than doubling to 14,590 compared to the preceding year.

MOM's labour market report for the fourth quarter of 2023 highlighted that the bulk of employment growth in 2023 stemmed from non-resident workers, particularly in Construction and Manufacturing, totalling 83,500.

Conversely, resident (Singapore citizens and Permanent Residents) employment experienced a more modest uptick of 4,900, concentrated in lucrative sectors such as Financial Services and Professional Services.

This means the number of job growth is 94.5% attributed to foreigners.

In 2022, total employment soared to a record-high increase of 227,800, with resident employment growing by 26,300, primarily in outward-oriented sectors such as financial services and information & communications.

This suggests that at least 88.5% of employment growth in Singapore for 2022 was fueled by foreigners.

On 28 February, Minister in the Prime Minister's Office Indranee Rajah revealed that the Singapore government granted about 23,500 new citizenships, including about 1,300 to children born overseas to Singaporean parents. Another 34,500 new permanent residencies were also granted.

In the fourth quarter of 2023, both resident (400) and non-resident (7,000) employment growth decelerated compared to the third quarter (resident: 2,800; non-resident: 20,800).

Meanwhile, December 2023 witnessed a slight uptick in job vacancies, totalling 79,800, breaking a streak of six consecutive quarters of decline.

MOM noted an overall cooling of labour demand throughout 2023, despite sustained employment growth, which progressively decelerated with each subsequent quarter.

However, unemployment rates remained low throughout 2023, and the number of job vacancies continued to surpass the number of job seekers.

The total number of retrenchments in 2023 reached 14,590, more than doubling the record low observed in 2022 but aligning closely with pre-pandemic levels, averaging 14,180 between 2015 and 2019.

Business reorganization and restructuring remained the primary reasons cited for retrenchments in 2023.

Notably, the number of retrenchments declined in the fourth quarter, dropping from 4,110 in the third quarter to 3,460.

MOM highlighted a decline in the re-employment rate, with 61.5% of retrenched workers securing employment within six months in the fourth quarter of 2023, down from 65.3% in the previous quarter.

Additionally, the ratio of job vacancies to unemployed persons rose to 1.74 in December 2023, indicating a moderately tight labour market.

Since March 2021's ratio of 0.96, there have been more job vacancies per unemployed person, according to MOM.

Looking forward, MOM anticipates a strengthening labour demand in line with improved economic growth prospects for 2024.

"Forward-looking data also indicate that more employers have plans to hire or increase wages in 2024."