Despite progress in resident employment, COVID-19’s effects linger on the labour market
SINGAPORE: The resident employment rate in Singapore has reached a level higher than pre-pandemic figures, but the labour market still faces ongoing challenges, according to the Ministry of Manpower (MOM) in the preliminary release of its 2021 Labour Force report. The resident employment rate rose to 67.2% in June 2021, surpassing both the previous year’s rate of 64.5% and the pre-pandemic figure of 65.2% in 2019.
This improvement is attributed to the combined efforts of various government schemes, including the SGUnited Jobs and Skills Package, which helped place over 146,000 individuals into jobs or training opportunities. Additionally, the Jobs Growth Incentive scheme enabled businesses to hire more than 400,000 locals. However, while employment figures rose, both unemployment and underemployment rates remain higher than those seen before the pandemic.
Youth and Senior Employment Rates Show Positive Trends
The employment rate for youths aged 15 to 24 saw a notable increase, rising to 37.2% from 30.9% the previous year. This was largely due to an uptick in students taking on part-time or temporary roles. Meanwhile, employment rates for adults aged 25 to 64 also grew to 81.8%, with the rate for men rising from 87.9% to 88.9% and for women from 73.2% to 75.1%.
The employment rate for senior citizens (aged 65 and above) saw the most significant growth, increasing from 28.5% in 2020 to 31.7% in 2021, supported by initiatives aimed at improving the employability of older workers.
Unemployment Rates Still Elevated Post-Pandemic
While the overall unemployment rate has improved, it remains above pre-pandemic levels. The unemployment rate for non-PMETs dropped to 5.1% from 6.4%, while PMETs saw a slight reduction from 3.5% to 3.4%. Long-term unemployment rates, which remain above pre-pandemic levels, suggest that some workers displaced during the pandemic are still struggling to secure stable positions.
Underemployment rates, defined as part-time workers seeking additional hours, also improved, falling from 4.1% in 2020 to 3.5% in 2021. However, these rates remain above pre-pandemic levels, particularly in sectors such as food and beverage and education.
Income Growth Reflects Recovery, but Inflation Limits Gains
The nominal median income for full-time employed residents rose by 3.2%, reflecting positive trends in the labour market. However, after factoring in inflation, real income growth was more modest at 1.1%. This growth was particularly notable for lower-wage workers, with those at the 20th percentile seeing a 4.6% increase in real income. These workers also benefitted from government support, such as the Workfare Income Supplement, which helped boost their earnings above pre-pandemic levels.
The government’s focus on uplifting lower-wage workers, including through initiatives like the Progressive Wage Model, has supported their recovery. Over the five-year period from 2016 to 2021, real income growth at the 20th percentile outpaced that of the median income, demonstrating continued progress for this group.
Looking Ahead: Challenges and Opportunities for the Future
Despite these positive developments, Singapore’s labour market has not fully returned to pre-pandemic conditions. The government and its partners will continue to focus on supporting businesses and workers through ongoing initiatives like the SGUnited Jobs and Skills Package. There will be an emphasis on developing the workforce’s skills to meet future demands, as well as enhancing job quality through redesign and transformation efforts.
MOM’s 2021 report, based on a comprehensive survey conducted from May to July, provides a detailed look at the recovery trajectory of Singapore’s labour force and highlights the need for continued investment in human capital and employment support.
