Total employment in Singapore expanded for the seventh consecutive quarter by 23,700 in Q2 2023, but at a significantly slower pace compared to previous quarters, according to data from the Ministry of Manpower. The data does not include migrant domestic workers.

Employment growth in Q2 2023 was from non-residents, mainly in the construction industry amid sustained demand for private and public sector projects, such as housing. The Ministry noted that construction is usually more reliant on non-resident manpower, and the proportion of residents in the sector is relatively lower.

Meanwhile, resident employment contracted slightly in Q2 2023, although resident employment still remained well above its pre-pandemic level. The decline occurred mainly in food & beverage services (F&B) and retail trade, which is not unusual in the first half of the year, the Ministry noted.

F&B and retail outlets typically increase their hiring of temporary staff in the fourth quarter to cater for year-end festivities, and reduce their number of staff in subsequent quarters, with the easing of consumer demand. Students mainly take up temporary work as a side job while schooling or on vacation, the ministry added.

Meanwhile, sectors such as community, social & personal services, financial services and professional services saw continued resident employment growth, although growth has slowed amid global economic headwinds.

“The slowdown in total employment growth reflects the moderation in our economic growth in previous quarters as a result of global economic headwinds,” the Ministry noted.

Unemployment rates did not change in June 2023 (overall: 1.9%; resident: 2.7%; citizen: 2.8%), after edging up in April and May.

Layoffs also declined in the second quarter. After rising over the past three quarters, the number of layoffs decreased from 3,820 in Q1 2023 to 3,200 in Q2 2023, similar to the range seen in 2019 (pre-pandemic). Business reorganisation or restructuring was the top reason for layoffs in Q2 2023.

“Looking ahead, firms appear to be adopting a more cautious stance towards hiring and wage increases,” The Ministry stated.

It added that labour market conditions could soften in the coming quarters.

The proportion of firms which indicated an intention to hire in the next three months declined from 64.8% to 58.2%. Similarly, the proportion of firms with intention to raise wages also fell from 38.2% to 28.0%, the data showed.

In the near term, employment growth could ease and be uneven across industries, according to the Ministry. While tourism-related sectors are expected to see continued improvements in labour market conditions, labour demand in outward-oriented sectors such as wholesale trade and information & communications would likely dampen.