The Associated Press
Singapore’s joblessness jumped in December as a collapse in demand for the city-state’s exports triggered manufacturing layoffs.
The unemployment rate rose to 2.6 percent from 2.2 percent in September and 1.7 percent in December 2007, the Manpower Ministry said in a statement on Friday.
The number of new jobs created sank to a net 26,900 in the fourth quarter, about half the 55,700 jobs created in the third quarter, the ministry said.
The manufacturing sector lost 6,200 jobs in the last three months of the year, the ministry said.
“Manufacturing jobs look particularly vulnerable,” said Robert Prior-Wandesforde, senior Asian economist for HSBC in Singapore. “We would be very surprised if job growth didn’t turn negative later this year, while the labor market won’t improve until well into 2010.”
Singapore expects gross domestic product to shrink up to 5 percent this year after growing 1.2 percent last year. The government said last week it plans to implement a $13.6 billion stimulus package of extra spending and tax cuts to help boost consumer demand and corporate profits.
Kit Wei Zheng, an economist with Citigroup in Singapore, said the government’s plan to subsidize 12 percent of the first $1,662 of every employee’s monthly wages will provide a “significant cushion” against layoffs for residents in low wage jobs but is unlikely to ease the pressure to cut high paying jobs such as in financial services.
The unemployment rate will likely rise to 4.2 percent this year as net job losses reach 34,000, more than during previous recession years of 2001 and 1998, said Kit.
“The labor market downcycle is still in its early days,” Kit said.
Layoffs in Southeast Asia have picked up this month as the global economic slowdown deepens. Singapore-based Chartered Semiconductor Manufacturing said Friday it planned to cut 600 jobs after forecasting a net loss of about $150 million in the first quarter.
Japanese electronics giant Panasonic said Wednesday a plant closure in Malaysia will cause 500 job losses and chipmaker Intel cut 1,800 jobs in the Philippines last week.
Singapore bank lending slips 0.4 pct in Dec from Nov
Bank lending in Singapore fell 0.4 percent to S$272.2 billion ($180.6 billion) in December from S$273.2 billion in November, the second monthly fall, central bank data showed on Friday.
Singapore manufacturers more bearish on outlook – survey
Singapore manufacturers are more pessimistic on their business prospects, a government survey showed on Friday, in the latest sign of the deepening impact of the global downturn on the city-state’s economy.
Overall, a net weighted 57 percent of manufacturers said they expect business conditions to deteriorate in the next six months to June 2009, Singapore’s Economic Development Board said in a statement.
This compares with the Board’s previous survey in October when a net weighted 18 percent of manufacturers were pessimistic on the outlook.
Singapore’s trade-dependent economy could shrink up to 5 percent this year, the government estimates, after the country was the first in Asia to fall into recession last year as weakening global growth hammered demand for its exports.