The Buzz over Employment: Got Diploma. Got Degree. Got Job?

By Val Alvern Cuoco Ligo

ILLUSTRATION: CHANDREYEE RAY

This doesn’t look like a good time to enter the job market. Besides the bleak employment statistics, there’s the fallout from the Covid-19 virus to consider, especially if anyone is thinking of going into the retail, aviation or F&B sectors. Even being a Grab driver isn’t going to be a breeze if people stop cabbing and stay at home.

Would Deputy Prime Minister Heng Swee Keat’s $4 billion Stabilisation and Support Package help workers keep their jobs? The Government will offset 8 per cent of the wages of each local worker, up to a monthly cap of $3,600 for three months. It will also extend funding for the retraining and redeployment of workers in some affected sectors. Going further, can we actually hope that more jobs will be created?

In these uncertain times, it becomes even more important for the job-seeker, especially the first-time job seeker, to understand the forces that underpin our employment rate.

But let’s get some terms out of the way first.

Unemployment Rate

In Singapore, this is usually very low, wiggling between 2.2 per cent and 1.9 per cent from 2019 to 2010. The bad news is that it touched 2.3 per cent in December 2019, the highest since 3.0 per cent back in 2009 after the global financial crisis.

Never mind right? Because the flip side is still a high overall employment rate. Note that the statistic does not distinguish between citizens and PRs. It also includes part-time workers, which might not be everyone’s idea of permanent employment.

Retrenchment Rate

Retrenchment is when permanent or contract employees are terminated because they have become “redundant”. This is especially so during times of economic downturns or restructuring. So, one aim of the Stabilisation package is to make sure that employers can pay their workers, even if business is down. Retrenchment rates are especially useful for indicating whether certain sectors are in trouble or becoming more technologically reliant. It could also indicate if companies are moving overseas due to increasing labour costs.

Job Creation

If retrenchment rates are a good indication of sunset sectors and industries, then job creation numbers are great at telling us which sectors are booming. Let’s not mistake this for vacancies — which means a replacement is needed for an already established position. The focus here is on the industries which want more employees - an indication of industry persistence, and more importantly, growth.

Job Vacancies

This is quite straightforward — it tells you how many slots there are to be filled and as the numbers below suggest, there might not be enough to go around (for now).

There are tons of surveys and studies out there trying to orientate workers to this new and unforgiving environment but with great numbers comes great variability which confuses those who try to break it down.

For this article, let’s focus on the findings of the Labour Market Survey by the Ministry of Manpower.

Labour Market Report

This is a quarterly release that analyses Singapore’s labour market situation. It surveys both individuals and companies and if you or your company were selected to participate, you are legally required under the Statistics Act (yes, there is such a thing) to comply.

All companies with more than 25 employees are automatically included in the study. Everyone else is further sorted by industry and number of employees. The report includes topics such as unemployment, employment, retrenchment, re-entry into employment, job vacancy, labour turnover, and hours worked.

The Numbers

Let’s look at the ‘Labour Market Advance Release 2019’ and the ‘Labour Market Third Quarter Release 2019’. The advance release is a preliminary report only but it sums up the market statistics for both the fourth quarter and the full year of 2019. Being a preliminary report, these statistics will only be confirmed in the final and full report that comes later. The third quarter refers to the months from June to September. The fourth quarter report refers to September and December and is usually released between January and February so we should expect to see it soon.

According to the infographic of the most recent iteration of the advanced release, the following trends were shown in its usual jargon:

1. “Total Employment Increased”

SOURCE: MOM

The above chart was taken from the third quarter release and reflects the employment change until the third quarter of 2019. The Labour Market Advance report projected total employment to have grown by 16,600 people in the fourth quarter (excluding Foreign Domestic Workers (FDWs). Each quarter in 2019 saw steady growth in employment, with Singapore’s total employment (excluding FDWs) growing by 55,200 through 2019. This is better than employment growing by only 38,300 in 2018.

TL; DR More people are being employed.

2) Retrenchment numbers remained consistent between 2018 and 2019

Despite word of oncoming bad times, retrenchments were only slightly higher than the previous quarter but still lower than the three quarters before that, at 2,430 total. Note that these are pre-virus numbers.

Overall retrenchments for 2019 remained low, at 10,700. 2018 saw 10,730 retrenchments.

3) What the Third Quarter Report Says

The number of job vacancies available dropped from 57,100 in the first quarter (Jan to March) to 47,700 in the second quarter (March to June) and finally to 42,200 in the third quarter.

With a 3.2 per cent resident unemployment rate (compared to 3.1 per cent in the second quarter), this translates to 83 job openings per 100 job seekers as of September 2019 – the lowest since December 2017.

TL;DR we don’t have enough jobs to fully cater to the number of unemployed persons.

4) “Unemployment Rates Held Steady”

Citizen unemployment: 3.3 per cent

Resident unemployment: 3.2 per cent

Overall unemployment: 2.3 per cent

SOURCE: MOM

5) “Annual Unemployment Rates Remained Within Range in the Recent Decade”

According to the graph below, both citizen and resident unemployment rates have remained steady throughout the past decade though it did increase from the previous year

SOURCE: MOM

Another indicator of job prospects, for university students at least, is the Graduate Employment Survey that the Ministry of Education releases annually. Manpower minister Josephine Teo recently cited the latest iteration of the survey, stating that about nine in 10 tertiary graduates who entered the workforce were employed within six months of graduation. It is important, however, to note that the results are only from those who respond to the survey which means that some faculties might not have enough data to produce any results.

WHY ARE SINGAPOREANS SO WORRIED?

The PMET squabble

For a while now, the favourite topic of the opposition parties in Singapore is the difficulty the 1.3 million professionals, managers, executives and technicians (PMET) face in finding and keeping their jobs. They make up the bulk, or 58 per cent, of the country’s workforce. Particularly, the worry for the Opposition is that mid-skilled foreign workers are squeezing these PMETs out of their jobs.

While PMET retrenchments have fallen in the last two years, PMETs have disproportionately bore the brunt of the layoffs. According to retrenchment statistics from MOM, inclusive of both locals and foreigners, PMET retrenchments made up nearly 60 per cent of total retrenchments from the first to third quarter of 2019. In the third quarter of 2019, there were 1.8 retrenched PMET locals per 1000 local employees, the highest amongst occupational groups for the quarter.

The next question you might be asking, “Why is this happening?” Well, for the IT industry, it might be due to a lack of sufficiently qualified Singaporean workers. According to a 2019 survey by global recruitment and job agency Robert Half, 92 per cent of Singaporean employers find it difficult to recruit workers with the appropriate IT skills for the new economy – higher than the Asia-Pacific average of 80 per cent and also the highest globally.

If you are thinking that Foreigners are the ones taking over the jobs, here is a link to the population hot topic which explains how it might not be that simple.

In December last year, the Singapore Democratic Party was slapped with a correction directive under the fake news law after publishing online statements about the state of PMET employment in Singapore. In one post, they used a graph depicting a fall in local PMET employment while another said there was a “rising proportion of Singapore PMETs getting retrenched” without specifying what proportion it was referring to. For MOM’s response and more on this story, you can read our story on SDP and Protection from Online Falsehoods and Manipulation Act (Pofma) here.

When news broke that Pofma was used against SDP, it prompted MPs to file several questions about PMET employment statistics to the manpower ministry. This included Workers’ Party chief Pritam Singh who asked the manpower minister for figures on the number of PMET jobs held by foreigners and PRs because of the lack of qualified Singaporeans for the job. He also asked for the names of industries with difficulty hiring Singaporeans for PMET jobs, the results of initiatives helping Singaporeans enter such roles, and for the ways the Government is ensuring adequate handover of skills from foreigners and PRs currently in the position, to Singaporeans.

These questions followed similar concerns the Workers’ Party had raised in their statement on Labour Day last year. It emphasised the need for more support for Singaporean workers, especially older PMETs, calling for more stringent checks for Employment Pass and S Pass applicants, stronger social safety nets for retrenched and unemployed workers and the abolishment of the retirement age.

Addressing these concerns, the manpower minister released data in parliament recently, stating that three in four people currently working in white-collar jobs are Singaporeans. She added that MOM works closely with agencies to secure PMET jobs for locals in sectors with good growth potential. For example, Workforce Singapore, along with other industry agencies, have placed 10,000 mid-career locals in PMET jobs in growth sectors between July 2017 and 2019. She also cited how the Adapt and Grow initiative has helped more than 48,000 local job seekers get placed in PMET roles over the past three years.

Machines are taking over

The fourth industrial revolution is here and the robots are taking over jobs that they can do cheaper, and more efficiently, across multiple industries. According to the McKinsey Global Institute, up to 800 million people worldwide could be displaced by automation by 2030. For example, the brick-and-mortar stores of the retail industry are being taken over by e-commerce platforms like Alibaba and Amazon. Even in the warehouses, the shuffling of feet is gradually being replaced by the quiet hum of little robots who almost exclusively run operations as seen in Alibaba’s “smart warehouses”.

A study by Cisco and economic forecasting company agency Oxford Economics found that workers in Singapore will be hit hardest by tech disruptions with the local market set to be most affected by job displacement across Southeast Asia. It showed that one-fifth of Singapore’s full-time workforce could have their jobs displaced by 2028. The study also noted that the Singaporean workforce will find it hardest to bridge the skill gap in order to move into new jobs which researchers attributed to our breakneck rate of digital transformation.

“The majority of new job opportunities in Singapore are likely to be created in highly skilled managerial and professional roles, reflecting the growth areas of the economy,” it added. “Thus, a considerable uplift is required in the overall skills composition of (the) workforce.”

How to keep the job

With all the talk of job displacement, how then, can workers keep these jobs? As cliché as it sounds, it’s all about continuous learning. Poly diplomas and university degrees are really just the beginning and are no guarantees of a life-long job, if anything, they are just to help us get our first big break. After that, it is about how you have re-skilled yourself to stay relevant.

Today’s economy and job market have made career mobility the new job stability. The shift from job stability to career mobility has been pushed by younger workers themselves, many of whom seek the opportunity to gain skills, work experience, or even simply better salaries, by moving to different industries and professions.

Employers have therefore have to find ways to attract and retain their best talents. In a 2017 LinkedIn report, 34 per cent of Singaporean professionals indicated they had no intention of staying with their current employers for more than a year. Because of these changing trends, job-hopping is no longer perceived with the stigma it once had. In a recent CNA report, the Ministry of Manpower announced a new focus on helping employees “improve opportunities and widen career tracks”.

In comes SkillsFuture, the platform aimed at helping Singaporeans prepare for lifelong learning and to more easily learn skills that can help them to switch professions. According to SkillFutures’ 2018 year in review, over 465,000 Singaporeans and 12,000 enterprises benefited from training subsidies in the year. About 52,000 people attended workshops covering 25 industries ranging from Accountancy and Aerospace to Retail and Sea Transport. In his Budget Statement, Deputy Prime Minister Heng Swee Keat announced more SkillsFuture credits especially for those thinking of switching careers.

The gig economy

Some have turned to the gig economy, or freelancing. These workers range from Grab drivers to independent contractors who do work for larger organisations. The freelance journalist, photographer, and now even web-designer, are part of this economy. Whether they do it by choice or not, they have the benefit of being their own boss and setting their own parameters. However, they are also left in a precarious position, working without long-term job security, robust health benefits, or a stable source of income. In addition, they won’t have personal and employer contributions to their CPF fund. While this might be a good thing to some – they get to use their money the way they want to – overall, they would still be excluding themselves from a retirement safety net.

This then brings up a sort of tension in priorities – do people, specifically millennials or Gen Zers want the time to search for jobs they want or do they just want to land a job, period.

The overall unemployment rates mentioned above accounted for workers of all ages but the Labour Market Report further breaks down the unemployment rate by age group.

The resident unemployment rate for those under 30 as of September 2019, is at 6.2 per cent, an increase from the 6.0per cent of the previous quarter. With that said, many of those within this age group could have just graduated from their tertiary institution, (including University, Polytechnic, or a Technical institute), and have just started to look for their first job.

If you’re one, good luck to you.

Read Calida's take on this here.