Singapore witnesses escalation in retrenchments, 2023 figures double the tally of previous year

As per the data, the number of retrenchments in the year 2023 skyrocketed to 14,320, a stark contrast to the 6,440 recorded in the preceding year. This substantial increase points to the economic challenges and uncertainties that have been exacerbated by global events and disruptions.

Startling figures from advanced labour market estimates released by the Ministry of Manpower (MOM) on Wednesday say that retrenchments in Singapore during the year 2023 have more than doubled compared to the previous year.

As per the data, the number of retrenchments in the year 2023 skyrocketed to 14,320, a stark contrast to the 6,440 recorded in the preceding year. This substantial increase points to the economic challenges and uncertainties that have been exacerbated by global events and disruptions. In the fourth quarter, fewer people were laid off (3,200) as compared to the third quarter (4,110), propelled by a fall in retrenchments in the wholesale trade sector.

The increase in retrenchments reflects the profound impact of various factors on the Singaporean job market. According to MOM (Ministry of Manpower), the primary reasons for retrenchment in 2023 were business reorganization or restructuring, due in part to the impact of global economic headwinds on outward-oriented sectors like wholesale trade, electronics manufacturing, and IT services.

MOM also stated, “Statistics on re-entry into retrenchment have so far showed that the majority of retrenched workers typically re-enter within six months post-retrenchment, and often in a different sector signalling the transferability of their skillsets.” The Ministry of Manpower has underscored the need for vigilance and proactive measures to address the evolving employment landscape.

Excluding the migrant domestic workers, the total employment surged by 8,400 in the final quarter of the year, which was also the ninth consecutive quarter that total employment had increased. MOM also marked that as compared to the previous quarters the growth in total employment has moderated ‘significantly’ for both residents and non-residents. MOM also asserted that the moderation was not unexpected as weaker hiring expectations and declining job vacancies from earlier quarters signalled cooling labour demand.

Post the sharp, post-pandemic rebound in the year 2022, the total employment growth for the full year of 2023 was moderate amidst weak economic conditions (from 227,800 to 89,400), said MOM. At 2 per cent all total unemployment rates remained unchanged in December 2023, meanwhile, the rates remained low and stable for the entire year of 2023.

On the other hand, MOM asserted, “Nevertheless, as downside risks in the global economy remain, business reorganization and restructuring may lead to further retrenchments, and unemployment rates may edge up.”