Worsening labour statistics: Earnings down, etc

I refer to the Ministry of Manpower’s (MOM) Labour Market FIrst
Quarter Report 2012, released on 15 June

Real earnings down – 3.9%

Real average (mean) monthly earnings fell over the year by 3.9% in thefirst quarter, after declining by 1.4% in the fourth quarter last year.

As this statistic is for mean earnings, the figure for real median
wages may be worse.

This does not bode well for workers, as it is likely that this year
may be yet another year of negative real median wage increase.

Productivity down

Labour productivity contracted by 2.2% over the year in the first
quarter of 2012, after declining by 0.5% in the previous quarter.

This also does not bode well for workers, particularly lower-wage
workers, as the consistent rhetoric that wages can only go up with
productivity increase, does not seem to be working.

Employment slows

Total employment rose by 27,200 in the first quarter of 2012, lower
than the seasonal high increase of 37,600 in the fourth quarter and
28,300 in the first quarter of 2011.

Unemployment up

The seasonally adjusted overall unemployment rate increased from 2.0%in December 2011 to 2.1% in March 2012. Similarly, the unemploymentrate rose over the same period for residents from 2.9% to 3.0% and forcitizens from 3.0% to 3.2%.

An estimated 59,100 residents including 52,800 Singapore citizens wereunemployed in March 2012. The seasonally adjusted figures were 64,000for residents and 57,700 for citizens.

Unemployed mostly degree holders?

Degree holders formed the largest share in the pool of resident job
seekers at 16,900 or 29% in March 2012.

Long-term unemployment up

Long-term unemployment also increased. 14,000 or 0.7% of the residentlabour force had been looking for work for at least 25 weeks in March2012, up from 11,800 or 0.6% a year ago. They formed nearly one infour (24%) of the 59,100 unemployed residents in March 2012.

Older workers long-term unemployed increased the most?

Among the age groups, the long-term unemployment rate either increasedor was unchanged over the year. The long-term unemployment rateincreased over the year for residents aged 30 to 39 (from 0.3% to0.4%) and mature residents aged 40 & over (from 0.7% to 0.8%).

Harder to get re-employed?

Based on CPF records, 50% of the residents laid off in the fourth
quarter of 2011 secured employment by March 2012. This rate of
re-entry into employment within six months of redundancy declined from59% in December 2011 and 60% in September 2011, but was still higherthan the low of 43% in June 2009.

Laid-off mostly PMETs?

The bulk of workers laid off were fomerly professionals, managers,
executives and technicians (PMETs) (1,190 or 46%) and production &
related workers (1,050 or 41%).

Older more likely to be laid-off?

Two in three (66%) residents laid off in the first quarter of 2012
were aged 40 & over, disproportionately higher than their
representation in the workforce (54%).

PMETs more likely to be laid-off?

(57%) of residents made redundant were previously holding PMET jobs,slightly higher than the PMETs’ representation in the workforce (52%).

Less job vacancies

The number of job vacancies declined by 5.1% over the year to 46,800in March 2012. After adjusting for seasonality, job vacancies declinedby 9.7% over the quarter to 50,000, though this was still higher thanthe recent low of 49,200 registered in September 2011. Along with therise in unemployment, the seasonally adjusted ratio of job vacancy tounemployed person fell to 105 job openings for every 100 job seekersin March 2012 from 120 per 100 in December 2011.

Work longer for less pay per hour?

The weekly paid overtime hours which averaged 3.7 hours in March 2012,was up marginally from 3.6 hours in December 2011 and March 2011.

Employees in construction and manufacturing clocked in longer paid
hours per week at 53.0 and 50.1, mainly pulled up by their
correspondingly longer paid overtime of 8.1 and 7.0 hours. A few
services industries had longer hours e.g. security & investigation
(total: 58.2, overtime: 14.5).

Anecdoctally, it may appear that some low-wage workers like security
guards may be maintaining their earnings or increasing them because ofworking longer or more overtime hours. This may mean a lower pay perhour, as highlighted in the recent case of bus drivers who had to worklonger hours but not necessarily with any increase in pay per hour.

Business costs increase

The unit labour cost (ULC) for the economy rose from a year ago by
3.7% in the first quarter in 2012, up from the 1.7% increase in the
previous quarter. The ULC in manufacturing rose by 4.2%, after
decreasing in the previous two quarters. Driven mainly by increases in
the ULC and services cost, manufacturing unit business cost (UBC) rose over the year by 5.1% in the first quarter, after increasing by 2.4% in the fourth quarter of 2011.

Leong Sze Hian

About the Author

Leong Sze Hian has served as the president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), Hotel Mumbai (associate producer), invited to speak more than 200 times in about 40 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of 2 countries. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.