SINGAPORE – More people were working in Singapore last year, but Singaporean workers saw their incomes rising at a slower pace than in the previous year.

The labour market improved overall, with fewer retrenchments and a lower annual average unemployment rate compared with the year before, according to the latest estimates released by the Manpower Ministry (MOM) on Thursday (Jan 31).

This is despite economic growth easing slightly from 2017. Preliminary estimates put growth at 3.3 per cent last year, down from 3.6 per cent in 2017.

MOM data shows that the typical Singaporean in full-time work earned more last year, with real median income rising 3.3 per cent year-on-year to $4,183 as of June.

But this is lower than the 5.9 per cent growth seen in 2017.

These income figures include employer contributions to the Central Provident Fund.

Lower-income Singaporeans are narrowing the wage gap. Over the last five years, real income at the 20th percentile grew at a faster pace – an average of 4.3 per cent per year – than at the median, where growth was an average of 3.6 per cent per year.

In terms of employment, the workforce grew by 39,300 in 2018, excluding foreign domestic workers. Of these additional workers, 28,400 were Singaporeans or permanent residents, while 10,900 were foreigners.

This is a turnaround from 2017, when the number of foreigners working in Singapore fell by 32,000 – the biggest drop in 15 years – which caused a rare drop in total employment.

The ministry said the increase was driven by the services sector, while the number of workers in construction and manufacturing continued to fall for the third and fifth consecutive year respectively.

More residents were employed last year in services industries such as community, social and personal services; transportation and storage; financial and insurance services; information and communications; and professional services.

The annual average unemployment rate fell to 2.1 per cent last year, from 2.2 per cent in 2017. The rates were 3 per cent for Singaporeans and 2.9 per cent for residents, down from 3.3 per cent and 3.1 per cent respectively.

Fewer workers were laid off last year than in 2017, as the economy continued to expand. A total of 11,020 workers were retrenched in 2018, down from 14,720.

However, MOM noted in a statement that labour market trends from September to December last year were mixed, with a slight uptick in unemployment rates compared with the third quarter of 2018.

It expects local workforce growth to remain modest going forward, due to the underlying demographics of an ageing population and low birth rates.

“As economic growth moderates, workers and businesses need to remain agile and responsive to economic restructuring and the evolving employment landscape,” it said.

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