Tough times for graduates entering the job market in Singapore
Author: PM editorial | Date: 9 Mar 2016
But unemployment is falling significantly for people with lower levels of education
Around one in three unemployed workers in Singapore are graduates, and they now make up the country’s largest demographic group of unemployed people.
A report from professional services and investment management firm JLL found that unemployment for residents with lower levels of education fell from 3.4 per cent to 2.6 per cent last year. But unemployment for university graduates has risen to three per cent from 2.6 per cent back in 2011.
Overall employment grew 0.9 per cent between 2011 and 2015; the lowest year-on-year growth since 2003. Singapore’s GDP grew by two per cent during the same period.
JLL also suggests that, following government restrictions on foreign manpower that were introduced in 2011, the resulting tight labour market has increased the pay packets of lower-salaried workers but has also slowed economic growth.
“While the proactive steps taken by the government in the last five years to tighten foreign labour growth have successfully raised productivity and wages, the growth of office space demand, retail sales, and food and beverage receipts have declined sharply,” said Regina Lim, national director, advisory and research, capital markets, at JLL.
“In the upcoming budget on 24 March, we hope the government can look into the supply-side constraints that are impacting overall economic growth and demand for real estate in Singapore, and consider tweaking the foreign labour growth policies to address the changing education and skills profile of Singaporeans.”
In an attempt to help organisations cope with the policy to reduce the dependence on foreign workers, the government introduced three schemes: the Productivity and Innovation Credit, which helps organisations co-fund productivity investments; the Wage Credit Scheme, which funded 40 per cent of wage increases for over half of Singaporean workers in 2013-15 and 20 per cent of wage increases in 2016 to 2017; and the Workfare Income Scheme, which was enhanced in 2013 to add to the wages of Singaporeans earning less than S$1,900 a month by S$1,400 to S$3,500 a year. As a result of these initiatives, local labour participation rates rose sharply among females and the elderly.
The report also found that professionals, managers, executives and technicians (PMETs) make up half of the workforce, as well as over three-quarters (77 per cent) of redundancies in the third quarter of 2015 – up from 64 per cent during the same period in 2013.
Meanwhile, locals took up 80 per cent of new jobs in 2012-14, compared to 50 per cent before 2010.