Unemployment inches up in first quarter but ‘remains low’

May 2, 201410:32 am269 views
Unemployment inches up in first quarter but ‘remains low’
Unemployment inches up in first quarter but ‘remains low’

SINGAPORE — Unemployment in the first three months of this year inched up and job creation slowed compared with the previous quarter, a Ministry of Manpower report showed yesterday.

The overall unemployment rate as of March was 2.1 per cent, compared with 1.8 per cent in December. The MOM noted that despite the increase, unemployment remained low compared with earlier quarters.

Layoffs declined after rising in the fourth quarter of last year. Between January and March this year, about 2,900 workers lost their jobs, compared with 3,660 in the preceding quarter. However, the figure was higher than the same period last year, when 2,120 workers were laid off.

In all, 24,900 jobs were added in the first quarter, compared with 40,600 in the fourth quarter of last year. The same period last year saw the creation of 28,900 jobs.

While total employment growth fell across the across the board in the manufacturing, services and construction sectors, job creation in the construction sector slowed most significantly — in the first quarter, 4,000 jobs were added in this sector, compared with 8,400 in the same period last year.

The construction sector is highly reliant on imported labour and economists whom TODAY spoke to attributed the dip to the gradual impact of the Government’s curbs on the hiring of foreign labour, as well as on the lukewarm property sector.

UOB economist Francis Tan noted that demand for construction had slowed and projects in the pipeline were being delayed.

In April last year, then Acting Manpower Minister Tan Chuan-Jin had pointed out that the Republic’s economy was generating more jobs than it should accommodate. In order to have sustainable long-term growth, Singapore must be more aggressive in its push towards “a productivity-driven, rather than jobs-driven growth”, he had said.

Agreeing, Mr Francis Tan reiterated that economic growth purely from adding more jobs was not sustainable.

However, DBS economist Irvin Seah said: “Maybe we’re seeing some improvement in productivity whereby companies are replacing workers with technology … But looking at the numbers, if (job creation) continues to decline, then it will be a concern. It could imply slower economic activity on a cyclical basis or it could maybe even reflect deep rooted structural weaknesses.”

Mr Seah added that generating new jobs is “always good for Singaporeans”. “The fact that we’re having a tight labour market does not mean we should slow down the momentum of job creation,” he said.

Both Mr Francis Tan and Mr Seah said the marginally higher unemployment rate was a not cause for concern, citing the tight labour market.

 

source: todayonline.com

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