Unemployment up, but median wage rises
THE latest Ministry of Manpower (MOM) report on the labour market conditions painted a mixed picture, with resident unemployment rate creeping up to a seven-year high, but real median monthy income rising at a faster pace compared to last year.
In its 2017 advance labour force report released on Thursday (Nov 30), the ministry also noted the decline in the employment rate for residents aged between 15 and 24 years old, due to “higher propensity of youths to postpone entry into the labour force” as more opt to pursue further education.
The labour force participation rate (LFPR) for residents aged 15 and above declined slightly from 68 per cent in June last year to 67.7 per cent in June this year, “following sustained increases over the decade”, MOM said.
Among residents aged 25 to 64, the LFPR continued to increase, reaching 83.6 per cent in June this year. “However, the dip in overall LFPR did not reflect an increase in the number of discouraged workers, which fell slightly from 9,900 in June 2016 to 9,500 in June 2017, and stayed low at 0.4 per cent of the resident labour force since June 2013,” MOM said. Discouraged workers refer to those outside the labour force who are not looking for a job because they believe their job search will not yield results.
Employment rate from residents aged 25 to 64 continued to increase from 80.3 per cent in June last year to 80.7 per cent in June this year. Over the same period, overall resident unemployment rate, on a seasonally adjusted basis, rose from 3 per cent to 3.1 per cent, matching a high in 2007 and 2010.
Nevertheless, real income rose faster over the same period given the improvement in economic conditions, MOM noted. Real income growth for both the median and 20th percentile were also significantly faster in the five years ending June 2017, compared to the preceding five-year period.
The nominal median monthly income (including employer CPF contributions) of full-time employed residents increased by 4.3 per cent to S$4,232 in June 2017. The increase was 3.7 per cent after factoring in inflation, higher than 3.3 per cent in June last year.
The findings of the report are based on a comprehensive labour force survey conducted in the middle of this year, which received responses from almost 28,000 households. The full report will be released in on Jan 26.
MOM said: “While the employment rates for residents aged 25 to 64 and 65 and over continue to increase, we expect population ageing and the higher propensity of youths to postpone entry into the labour force to exert downward pressure on the overall employment rate in the years ahead.”
Adding that local workforce growth is expected to continue to slow further, the ministry said the dip in the PMET (professionals, managers, executives and technicians) long-term unemployment rate suggested that more locals are re-skilling to take on new jobs or switch careers as the economy restructures, “with Government support through Skillsfuture and the Adapt & Grow initiative”.
MOM added: “For real income growth to be sustained, firms will have to continue to transform and grow to become more productive. In a manpower-lean environment, it is also important for firms to adopt progressive human capital practices.” – TODAY