Debated in Parliament on 4 Nov 2014.
Mr Yee Jenn Jong asked the Minister for Manpower in light of the 2013 Labour Force Survey report which states that the unemployment rate for degree holders below the age of 30 is 7.4% (a) what are the reasons behind this relatively high unemployment rate; and (b) whether the Ministry is taking any measures to address this issue.
Mdm Speaker, when Mr Yee alludes to the fact that the unemployment rate of 7.4% is high, I am not very certain what his reference points are, but there are a few perspectives. One, does he mean that it is high compared to other countries? Secondly, is it high because it is higher than the overall unemployment rate? Or is it high because it has increased significantly from the past? Let me address these three perspectives.
Firstly, across all educational levels, our youth unemployment rate has remained low, and, in fact, very low by international standards. Whether compared with the advanced economies, such as the US and EU, which are facing youth unemployment rates in the double digits, or with other developed Asian economies such as Hong Kong and South Korea, we are faring pretty well.
Secondly, youth unemployment across all countries is typically significantly higher than the overall unemployment rate. This pattern is similarly reflected in our unemployment rate of 7.4%, which is non-seasonally adjusted, for degree holders below the age of 30, compared to the overall unemployment rate amongst degree holders, again non-seasonally adjusted, of 3.6% in June 2013.
We will find this pattern repeated across all the different countries. And there is a reason for this. This is mainly due to the fact that new graduates joining the job market, as well as the higher incidence of job switching amongst young graduates, as they figure out what exactly they want to do, rather than any systemic difficulty in securing employment. So, you will find these trends typically across most, if not all, countries. About nine in 10 of our young degree holders from the local Autonomous Universities are able to secure a job within six months of graduation. The median duration of unemployment for resident degree holders below the age of 30 is also not long – at about five weeks.
Thirdly, the rate has come down from 2009 and has remained largely stable for the recent few years.
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The Government will continue with a comprehensive approach to keep both overall unemployment and youth unemployment rates as low as we can. First, it is crucial – and I think it is important for us remember – that we do need to maintain a strong and vibrant economy so that businesses have a conducive environment to operate in and, in turn, create quality jobs for our young people and, in fact, for all Singaporeans. Secondly, we do need to ensure that our education and training system continues to equip Singaporeans with industry-relevant skills to prepare them for the job market. We know that trends are evolving, technology is evolving quickly. So, this is where the commitment to lifelong education for Singaporeans at every educational level is particularly important.
MOM will also continue to monitor the unemployment rate, as I mentioned to Mr Patrick Tay earlier, and also under-employment rate, of young degree holders and, frankly, for Singaporeans at every level. We will continue to work closely with tripartite partners to help young degree holders access quality jobs, and facilitate their career development and progression.
I thank the Minister for the answer. I would like to just look at the data. The Minister said that we are actually doing very well according to the data. But I also noticed a trend – the Minister said that it has actually been falling or has been steady since 2009. But actually it has been rising from 6.6% in 2011 to 7.4% today. It roughly translates to over 24,000 graduates under the age of 30 that are classified as unemployed.
Also, in the earlier Parliamentary Question (PQ), we looked at the graduates' under-employment. This is also a figure that is rising among graduates whereas for other education groups, it has actually been falling.
So, I would like to know that moving forward, does the Ministry feel that it is important to do further studies to determine if there is any mismatch between the jobs and the training in our tertiary institutions. This is especially so because we are expanding the number of degree places in the publicly-funded Universities, and more and more people are also taking on private degree programmes.
Mdm Speaker, I will be happy to follow up with Mr Yee on specifically the percentage points that he is referring to. I am not sure whether he is comparing like for like. The 7.4% in the PQ refers to the unemployment rate of resident degree holders below the age of 30, while the 6.7% refers to the annual resident youth, aged 15 to 24, unemployment rate. But be that as it may, we can follow up and check which specific data point he is referring to.
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We do track this situation quite closely. As I have mentioned before, although we are not at that stage yet, my big concern is that if we do not arrest this trend, I think you will find a greater risk of unemployment and under-employment as more youths pursue other options, especially through private education institutions.
It does not mean that by pursuing studies in the private education institutions, you will not be able to necessarily do well and fulfil your aspirations in life. There will be those who do well. As you would realise, there will be institutions out there that will be quite happy to provide you a qualification if you look hard enough, and are prepared to spend time and money, but the standards do vary. We do see it now in terms of employment outcomes. In terms of the employment opportunities and especially the remuneration packages, it is less than desired and that is a worrying trend. If we continue along that path, we will encounter some of the problems that other countries are facing.
We track this data quite closely to avoid that situation from developing in the first place.
PAPERCUTS