Unemployment fell to pre-Asian crisis level
Amid the buoyant economic performance, employment creation remained
strong in the third quarter. The robust job creation, coupled with
an easing in the growth of resident manpower supply led to a
decline in unemployment rate to the pre-Asian crisis level. Wages
continued to rise in the quarter but at a more moderate pace.
2. Total employment expanded by 58,600 in Q3 07, up substantially
from the increase of 43,000 in Q3 06, making it the second highest
quarterly increase after the 64,400 recorded in Q2 07.
Cumulatively, 172,400 jobs were added in the first three quarters
of 2007, comparable to the gains of 176,000 for the whole of
2006.
3. Amid rapid economic growth and easing in the increase in
resident labour supply1, the seasonally adjusted overall
unemployment rate declined to 1.7% in Sep 07 from 2.3% in Jun 07.
The resident unemployment rate also fell significantly to 2.3% from
3.1% over the same period. Both unemployment rates are the lowest
recorded in almost a decade, having improved to pre-Asian crisis
levels. An estimated 40,300 residents were unemployed in Sep 07.
The seasonally adjusted figure was 45,400.
4. The number of long-term unemployed residents who had been
looking for work for 25 weeks or more also dropped to a ten-year
low (for September periods). There were 8,500 long-term unemployed
in Sep 07, forming 21% of the unemployed residents as compared to
12,300 or 20% a year ago. The share of long-term unemployed
residents in relation to the resident labour force was 0.4%, down
from 0.7% a year ago.
5. 1,827 workers were retrenched in Q3 07, an improvement from
2,472 in Q3 06 and 1,918 in Q2 072. This brings the total number
retrenched in the first nine months of 2007 to 5,709, much lower
than 9,388 in the same period last year. CPF records revealed that
62% of residents retrenched by private sector establishments each
with at least 25 employees in Q2 07 were re-employed by Sep 07
(i.e. within six months after retrenchment). This was lower than
70% in Jun 07 and 74% in Sep 06.
6. Reflecting the strong business conditions, 35,500 jobs were
unfilled in Sep 072, more than 29,900 in Sep 06 and just below the
post-Asian crisis peak of 37,400 in Jun 07. Overall, the unfilled
posts (i.e. job vacancies) represented 2.4% of total manpower
demand in Sep 07, up from 2.2% a year ago. The manpower shortfall
was larger for Professional, Managers, Executives & Technicians
(PMETs) and clerical, sales & service workers as their vacancy
rates at 2.7% each was substantially higher than for production
operators, cleaners & labourers at 1.8%. Across sectors,
services (2.8%) posted above-average vacancy rate, compared to
below-average rates for manufacturing (1.8%) and construction
(1.4%).
7. Wage growth (year-on-year) moderated in Q3 07, after
accelerating for three consecutive quarters. Average (mean) monthly
earnings based on CPF records rose by 6.9% over the year in Q3 07,
down from 8.5% increase in Q2 07. After adjusting for inflation,
the real earnings growth moderated to 4.0% in Q3 07 from 7.5% in Q2
07.
8. Overall labour productivity was flat in Q3 07, following a
marginal 0.4% gain in the preceding quarter. This led to an
increase in the overall unit labour cost (ULC) by 5.9%, slightly
lower than the 6.3% growth in the previous quarter.
9. In summary, the labour market turned in another quarter of
strong performance. Robust employment creation and slower growth in
resident manpower supply, led to an improvement in unemployment
rate to the pre-Asian crisis level. Amid manpower shortages, wages
have continued
