Debated in Parliament on 6 Aug 2024.
Mr Liang Eng Hwa asked the Minister for Manpower in view of the Ministry's recent Labour Market Report for the first quarter of 2024 which indicated that the rate of re-entry for retrenched workers has dipped, (a) what are the causes of this trend; (b) whether more can be done to help retrenched Singaporeans find jobs sooner; and (c) whether there is a risk of higher structural unemployment.
The re-entry rate six months after retrenchment for retrenched resident workers dipped slightly from 61.5% in the fourth quarter of 2023 to 59.4% in the first quarter of 2024. The decline in re-entry rate was driven by residents retrenched from Information and Communications, Financial and Insurance Services and Professional Services. These sectors saw relatively higher retrenchments in 2023 and slightly lower re-entry rates due to their exposure to global economic headwinds. Re-entry rates of residents retrenched in most other sectors remained similar. Among residents who have yet to find employment at the six-month mark, some might still be looking for a preferred role, are undergoing training or taking a break. Given that many of the retrenched workers from these sectors possess in-demand skills, we expect re-entry rates to improve over time. The re-entry rates of previous cohorts of retrenched workers usually rises to around 75% at the 12-month mark. In addition, the majority of such workers receive similar or higher salaries in their new jobs.
The long-term unemployment rate, which is associated with structural mismatches in skills, is a better indicator of structural unemployment. This rate has remained low at 0.8% as of March 2024, within the range observed during non-recessionary periods. At the same time, overall labour demand has remained strong. Resident employment growth was positive in the first quarter of 2024 and job vacancies continue to outnumber jobseekers.
The Government will continue to extend support to local workers who are retrenched. Firstly, for immediate employment facilitation, the Taskforce for Responsible Retrenchment and Employment Facilitation, comprising Government and union representatives, reaches out to all affected retrenched workers via their employers to offer career matching services and information kits. Second, there are a variety of reskilling programmes, such as Workforce Singapore’s Career Conversion Programmes and the Mid-Career Pathways Programme, to help workers transition into new jobs.
Finally, we will be introducing a support scheme to help involuntarily unemployed jobseekers to bounce back into employment. We are close to finalising the scheme parameters and more information will be announced later this year.
PAPERCUTS