UNEMPLOYMENT AND LONG-TERM UNEMPLOYMENT RATES REMAIN ELEVATED
The unemployment and long-term unemployment rates “remain elevated”, said MOM.
This is despite the downtrend in seasonally adjusted unemployment rates in June, with the rate at 3.5 per cent for residents and 3.7 per cent for citizens.
The seasonally adjusted resident long-term unemployment rate also dipped to 0.9 per cent in June, from the high of 1.1 per cent in December 2020 and March 2021.
In the first half of the year, there were 4,620 retrenchments, or 2.3 retrenchments for every 1,000 employees.
“These were comparable to the half-yearly levels seen in 2018/2019,” said MOM.
By quarter, retrenchments were slightly higher in the second quarter with 2,340 layoffs, compared with 2,270 retrenchments in the first quarter. This is amid the Phase 2 (Heightened Alert) measures.
More employees, particularly those in the food and beverage services, were placed on short work-week or temporary layoff in the second quarter – 5,580 compared to 4,020 in the first quarter.
“While the number remained elevated compared to pre-pandemic times, the prevalence of such temporary work arrangements helped to keep retrenchments relatively low in 1H 2021,” said MOM.
The six-month re-entry rate among retrenched residents dipped slightly in the second quarter, following improvements in the fourth quarter of 2020 and the first quarter of this year. It fell from 66 per cent to 64 per cent.
As vaccination rates continue to rise, domestic and border restrictions should be eased progressively, said MOM.
“This should raise employment levels and progressively reduce unemployment rates.
“However, we should expect the labour market recovery to be uneven across sectors as uncertainties in the external economic environment remain.”
Tourism- and aviation-related sectors are projected to have a “slow recovery” as “travel restrictions globally are likely to be lifted cautiously and global travel demand may also remain sluggish amidst the spread of more contagious strains of the virus”, said MOM.
Activity in these sectors is expected to remain “significantly below” pre-pandemic levels even by the end of the year.
Meanwhile, consumer-facing sectors such as food and beverage services and retail trade should start to recover, as domestic restrictions ease over the year.
However, they are not expected to return to pre-pandemic levels due to the “subdued” tourism outlook.
“By contrast, the growth prospects for outward-oriented sectors remain strong given the rebound in global demand. These include the manufacturing, wholesale trade, information and communications and financial and insurance services sectors.”