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SINGAPORE - Amid ongoing economic restructuring, the labour market showed further signs of recovery in the third quarter of this year, with a lower overall unemployment rate and no increase in retrenchments.

The unemployment rate was 2.1 per cent in September after accounting for seasonal variations, down slightly from 2.2 per cent in June, preliminary data released by the Ministry of Manpower (MOM) on Friday (Oct 27) shows.

For Singaporeans, the rate was 3.2 per cent last month (Sep), down from 3.3 per cent in June and 3.5 per cent in March.

For residents - or Singapore Citizens and Permanent Residents combined - the latest rate was 3.1 per cent, unchanged from June but down from 3.2 per cent in March.

The elevated levels of job losses of 2016 appear to have abated.

Retrenchments in the third quarter - from July to September - remained at about the same level as in the previous quarter, coming down marginally to 3,600, from 3,640. The decline was due to fewer layoffs in the manufacturing sector, while there were more layoffs in services and construction.

The figure does not include the 130 retrenchments at Singapore Press Holdings this month, which fall under the fourth quarter tally.

In a statement, MOM cautioned that the unemployment rate for residents may be difficult to reduce further in the medium term due to on-going economic restructuring and a mismatch between jobs available and workers' skills, for example.

"Companies undergoing restructuring are also urged to prepare at-risk workers for new roles in the firm, so as to reduce the need for retrenchments," added the ministry.

In all, the economy employed fewer workers at the end of the third quarter, with total employment excluding maids falling by 2,500 - the third consecutive quarter of decline. However, the contraction was smaller than those of the previous two quarters.

Since the end of last year, the economy has shed 19,800 workers, which the MOM attributes mainly to a decrease in work permit holders in the marine and construction sectors due to low oil prices and less construction activity. The services sector continues to add workers.

Total employment was 3,658,300 as of September.

MOM highlighted job opportunities in five priority sectors: infocomms and media, finance and insurance, healthcare, professional services and wholesale trade.

More job support is being developed for these areas, such as professional conversion programmes to help mid-career workers gain skills for new jobs. The ministry said more than 1,500 people have used such programmes in all sectors in the first half of this year.

National Trades Union Congress assistant secretary-general Patrick Tay called the lower unemployment rates "encouraging", and said he expects the total number of layoffs this year to be lower than last year.

"Notwithstanding, we will continue to see pockets of layoffs in the last quarter due to ongoing restructuring, re-organisation and re-strategisation by companies and businesses faced with disruption, digitalisation and changing demand patterns including the oil prices," he said in a Facebook post.

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Lower unemployment in Q3 for Singaporeans; retrenchments down slightly: MOM

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SINGAPORE - Amid ongoing economic restructuring, the labour market showed further signs of recovery in the third quarter of this year, with a lower overall unemployment rate and no increase in retrenchments. The unemployment rate was 2.1 per cent in September after accounting for seasonal variations, down slightly from 2.2 per cent in June, preliminary data released by the Ministry of Manpower (MOM) on Friday (Oct 27) shows.

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More importantly, the earlier drag came from business loans. Lending to the corporate sector eased to 7.4% in July, from 10.5% previously. This could be an initial sign that the business cycle is reaching its peak

This shows that the amount of loans the bank is lending to the corporate companies are getting lesser as they have earned higher interests payments from their business loans and savings. Therefore causing net interests to increase, leading to the increase in real GDP where business cycle will eventually reach the peak.

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SINGAPORE: The full year growth forecast for the Singapore economy has been narrowed to 2 to 3 per cent, from the earlier range of 1 to 3 per cent, said the Ministry of Trade and Industry (MTI) on Friday (Aug 11) as data showed the economy growing quicker than initially thought in the second quarter.

Compared with a year ago, Singapore's gross domestic product (GDP) grew by 2.9 per cent in the three months to June, beating both the previously announced second-quarter advance estimates and first-quarter GDP numbers which showed year-on-year growth of 2.5 per cent.

This meant that the local economy grew 2.7 per cent on a year-on-year basis for the first half of 2017.

On a quarter-on-quarter seasonally adjusted basis, GDP grew by 2.2 per cent during the April-to-June period, way above the earlier estimate of 0.4 per cent growth and reversing from a contraction of 2.1 per cent in the preceding quarter.

The manufacturing sector continued its outperformance to clock robust year-on-year growth of 8.1 per cent in the second quarter. This comes on the back of 8.5 per cent expansion in the previous three months, as the electronics and precision engineering clusters remain buoyed by strong global demand.

On a quarter-on-quarter basis, manufacturing expanded 2.9 per cent, accelerating from the 0.3 per cent growth in the previous quarter.

Looking beyond the manufacturing sector, which has been the key propeller of growth for the past few quarters, certain services sectors such as wholesale & retail trade, finance & insurance, as well as business services, all recorded accelerated year-on-year growth in the second quarter.

This shows that the overall performance of the Singapore economy has "strengthened" and is showing "some signs of broadening" from the manufacturing sector to externally oriented sectors, said MTI permanent secretary Loh Khum Yean.

Still, some unevenness remains. The construction sector, for one, remained in contraction while growth in certain clusters within the manufacturing sector, such as the biomedical manufacturing and transport engineering clusters, continued to be weak, Mr Loh added.

The local labour market is mirroring this divergence in the economy, such as how the weak marine and offshore segment has been a drag on manufacturing employment, said Mr Terence Ho, divisional director of Manpower Planning & Policy division at the Ministry of Manpower.

In line with the economic outlook, the MOM expects the labour market to likely remain modest for the rest of the year.
GLOBAL GROWTH ON TRACK TO BE HIGHER IN 2017: MTI
MTI in its media release said global growth in 2017 is on track to come in higher than last year.

Supporting factors include faster pace of economic growth in the US and the Eurozone.

In Asia, China's growth is projected to ease slightly in the second half of the year as real investments see a modest slowdown. However, exports are expected to remain robust.

Closer to home, growth in the Indonesian and Malaysian economies is projected to remain resilient for the remaining quarters of the year on the back of healthy domestic demand and a sustained improvement in merchandise exports.

Downside risks continue to linger though the potential impact of these negative factors on growth has eased, compared to three months ago, said MTI. These risks include anti-globalisation sentiments that could adversely affect global trade remain, elevated global political risks and policy uncertainty, faster-than-expected policy tightening in the US as well as the potential of a steeper-than-intended pullback of credit in China.

Against this external backdrop, MTI expects the manufacturing sector to continue to provide support to the Singapore economy in the second half of the year. In particular, the strong performance of the electronics and precision engineering clusters is expected to be sustained into the remaining two quarters on the back of robust global demand for semiconductors and semiconductor-related equipment, although the pace of expansion may moderate given less favourable base effects.

Likewise, externally-oriented services sectors such as transportation & storage, wholesale trade and finance & insurance sectors, are expected to benefit from the pick-up in global trade. The information & communications and education, health & social services sectors are also likely to remain resilient.

On the other hand, the performance of the construction sector is expected to remain lacklustre, weighed down by the continued weakness in private and public sector construction activities.

Taking into account the global and domestic economic environment, MTI said the full-year growth forecast for the Singapore economy has been narrowed upwards to a range of 2 to 3 per cent. Barring unexpected outcomes in the global economy and key sectors in the domestic economy for the rest of the year, MTI added that it expects GDP growth for 2017 to likely to come in at around 2.5 per cent.

Earlier this week, Prime Minister Lee Hsien Loong said in his National Day message that the Government expects the economy to grow around 2.5 per cent for 2017, higher than last year's growth of 2 per cent.

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Singapore narrows 2017 GDP forecast as Q2 growth quickens to 2.9%

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(Updated: ) Share on Facebook Share on Twitter Share via E-Mail SINGAPORE: The full year growth forecast for the Singapore economy has been narrowed to 2 to 3 per cent, from the earlier range of 1 to 3 per cent, said the Ministry of Trade and Industry (MTI) on Friday (Aug 11) as data showed the economy growing quicker than initially thought in the second quarter.

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WORKERS in Singapore can expect to see a real salary increase of 2.7 per cent in 2018, according to the latest Salary Trends survey by ECA International (ECA).

The figure factors in inflation, which the survey indicated to be approximately 1.3 per cent for the coming year.

This means that wage-earners should expect to see a nominal salary increase of four per cent in 2018.

"Over the past few years inflation in Singapore has increased while nominal salary increases have stayed flat, which has had the effect of slowly eroding pay rises in real terms," said Lee Quane, ECA's regional director of Asia.

"Despite this, the salary increases for 2017 and 2018 compare favourably with other developed economies in the region and globally," he added. "This reflects the fact that the Singapore economy continues to perform well on the back of global economic recovery."

Its projected wage growth ranks Singapore 9th out of the 20 countries surveyed in the Asia-Pacific (APAC) region and 14th globally.

Argentina topped the global list with a projected real wage growth of 7.2 per cent.

"President Macri's market-friendly policies are expected to bear fruit in Argentina next year, causing inflation to cool and bringing respite to hard-pressed workers after years of low or negative real salary increases," Mr Quane added.

Led by India in second place with a real wage growth of 4.9 per cent, APAC countries occupied eight of the top ten spots in the global rankings - with all locations expecting to receive above-inflation salary increases.

Among South-east Asian countries surveyed, Vietnam and Indonesia ranked a joint fourth globally, ahead of Thailand (6th) and Cambodia (10th).

Bouyed by low unemployment and a strong economy, workers in Malaysia (ranked 20th) - who have seen wage increases above five per cent for several years - can expect such raises to continue in 2018 with inflation in Malaysia forecasted to fall back slightly, the survey found.

China ranked fifth globally with wage earners predicted to have six per cent real wage increments - higher than the 5.5 per cent awarded on average in 2017 - while, Hong Kongers are expected to see a real salary increase of 1.8 per cent in 2018.

However, Australians will see the lowest increase in their earnings in 2018, with real wages expected to rise by only 0.8 per cent, the survey found.

In Europe, expected real salary increases remain low. Real wage growth in Germany and France is expected to be 1.2 per cent and 0.9 per cent respectively while the UK will see the lowest rate of real wage growth in the region at 0.2 per cent.

In North America, the US and Canada are set to remain steady, with real wages growing at 0.9 and 1.1 per cent respectively.

The survey by ECA, a provider of data, specialist software, consultancy and training, is based on information collected from 260 multinational companies across 72 countries.

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Singapore workers to see 2.7% real pay increase next year: survey

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THE BUSINESS TIMES Government & Economy - WORKERS in Singapore can expect to see a real salary increase of 2.7 per cent in 2018, according to the latest Salary Trends survey by ECA International (ECA).. Read more at The Business Times.

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The labour market in 2017 shows signs of recovery in the third quarter of this year, with a lower overall unemployment rate and slight decrease in retrenchments.

The unemployment rate was 3.2% in September and it dropped by 0.1 % from June, with unemployment rate of 3.3 %. Unemployment rate also decreased by 0.2% from 3.5% in March to 3.3% in June.

The reason for the unemployment rate to go down from the quarters consecutively is mainly due to the creation of  better jobs and increase in demand of exports. Therefore, there will be an increase in the labour workforce, which drives the output of the nation. This improves the economy of the nation, leading to an increase in the wages/income of workers. Hence, real GDP increases.

As the unemployment rate is below 5%, it shows that Singapore's economy is operating at full employment, which is ideal. However,  it does not mean zero unemployment as the economy still has a small percentage of unemployed adults, which is part of the natural rate of unemployment.

When unemployment rate increases,  the government can step in to ameliorate the situation. From this article, we can see that the government has provided more job support, such as professional conversion programmes such as SkillsFuture to help mid-career workers gain skills for new jobs. The ministry said more than 1,500 people have used such programmes in all sectors in the first half of this year.

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Inflation refers to a sustained and continuous increase in the general (average) prices of goods and services in the economy.

In 2018, ECA International predicted an increase in real income of workers by 2.7%. There will be an inflation of 1.3% in the coming year and nominal salary of workers is expected to increase 4% by 2018.
Nominal Income= Real Income + Inflation Rate

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Consumer prices in Singapore increased 0.4 percent from a year earlier in October of 2017, the inflation figure remained the lowest since April, as cost of food increased at a faster pace while transport inflation was similar from the preceding month.
The projected pickup in inflation could be due to the positive contribution in the exports of energy-related components produced in Singapore and the impact of administrative price increases, rather than generalized demand-induced price pressures.

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The GDP (Gross Domestic Product) is defined as the market value of all final goods and services produced in an economy during a calendar year.

The full year growth forecast for the Singapore economy has been narrowed to 2 to 3 per cent, from the earlier range of 1 to 3 per cent
Compared with a year ago, Singapore's Gross Domestic Product (GDP) grew by 2.9 per cent in the three months to June, beating both the previously announced second-quarter advance estimates and first-quarter GDP numbers which showed year-on-year growth of 2.5 per cent.
The increase in Real GDP is due to the trade-related sectors such as manufacturing and
transportation and storage striving continuously, bringing the economy
closer to its peak.

Economic growth rate is measured by the percentage change in the monetary value of Real GDP of the current year over the previous year.

A higher real GDP means that more goods and services have been produced in the economy in 2017. This brings about a positive economic growth rate in year 2017.

Overall performance of the Singapore economy has "strengthened" and is showing "some signs of broadening" from the manufacturing sector to externally oriented sectors
The local labor market is mirroring this divergence in the economy, such as how the weak marine and offshore segment has been a toll on manufacturing employment. Since there is a decrease in work permit holders in marine and offshore segment, it has affected the whole manufacturing employment rate causing it to decrease.
The construction sector, for one, remained in contraction while growth in certain clusters within the manufacturing sector, such as the biomedical manufacturing and transport engineering clusters, continued to be weak.

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Companies are slowly eroding the idea of having rising pay for the workers.
Despite this, the increase in workers' salary for 2017 and 2018 is favorably compared with developed economies in the region and globally which reflects the fact that the Singapore economy continues to perform well on the back of global economic recovery.
This is due to a sustained increase in global electronics demand. Therefore, exports of Singapore increase, generating a higher revenue, contributing to the growth of GDP.

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As the real wages increases, workers would want to increase their aggregate expenses as there is an increase in disposable income and purchasing power. This leads to a movement along the consumption function according to Keynes. An increase in spending is the fundamental psychological law that when income increases, spending increases.
This leads to an increase in aggregate demand for better goods, which contributes to Singapore's economy.