Employment rises in Q1 but jobless rate up
Brisk hiring rate outpaces productivity; wages on the rise
By NANDE KHIN
THE job market here continued to remain tight in the first quarter
as total employment rose by 49,400 and the number of layoffs
declined sharply, according to the Ministry of Manpower
(MOM).
However, the resident jobless rate of 4 per cent, seasonally
adjusted, in March is an increase from December's 3.6 per cent and
the 3.5 per cent in March 2006, as more people were attracted back
into the workforce by buoyant economic conditions, said MOM in its
quarterly report.
The resident rate - which covers Singaporeans and permanent
residents - is typically higher than the overall rate which also
includes foreigners on work passes.
The overall unemployment rate, seasonally adjusted, also rose -
from 2.6 per cent in December 2006 to 2.9 per cent in March this
year.
The resident labour supply increased by 17,700 in Q1, as more
people entered the workforce, lured by rosy job prospects as a
result of the robust economy, said MOM.
This is higher than the average increase over the last two years,
when favourable economic conditions also led to an increase in
resident labour supply in the first quarter but by a lower average
of 10,700.
The buoyant economy also generated a large number of job vacancies
which reached 32,200 in March. This is 30 per cent higher than a
year ago, but is broadly unchanged from December (32,000).
About seven in 10 vacancies (22,600) in March were in the services
sector. Manufacturing added another 7,900 or 24 per cent of the
openings while the remaining vacancies were in the construction
sector.
Nearly half (14,400) of the vacancies were for professionals,
managers, executives and technicians (PMETs).
Weighed down by the increase in job seekers, the seasonally
adjusted ratio of job vacancies to unemployed persons dropped to 68
vacancies for every 100 job seekers in March, down from the
five-year high of 79 per 100 in December. Nevertheless, this is
still higher than the 60 vacancies for 100 job seekers ratio in
March 2006.
Far fewer workers (1,964) were also laid off in Q1 this year,
compared with the 3,215 retrenched in the previous quarter and the
3,653 laid off in the corresponding quarter a year ago.
In particular, the number of retrenched workers in the
manufacturing sector fell sharply from 2,447 in Q4, 2006 to 1,393
in Q1 this year, although the sector still accounted for the
majority (71 per cent) of layoffs.
Based on CPF records, 59 per cent of the residents retrenched by
private sector establishments with at least 25 employees in Q4 2006
were re-employed by March this year.
However, as employers continued to hire to meet current and
anticipated increases in output, job creation has outpaced the
growth in output resulting in lower productivity but higher wages,
said MOM.
This has resulted in a 1.6 per cent dip in productivity in Q1 over
the corresponding quarter in 2006. It represents the second
consecutive quarterly decline in productivity after the 0.7 per
cent drop in Q4 2006.
Nevertheless, wage pressures have continued to intensify,
reflecting the brisk hiring pace.
Average nominal earnings based on CPF records posted a strong
year-on-year increase of 5.5 per cent in Q1 this year, higher than
the 3.1 per cent in the preceding quarter. After adjusting for
inflation, the increase in real terms was 5 per cent and 2.5 per
cent respectively
