2022 kicked off to great optimism from Singaporean employers, with the local labour market reporting a net employment outlook score of +25 per cent in the latest ManpowerGroup Employment Outlook survey (running since 1962) for the second quarter of 2022. In Singapore it is conducted on a sample group of 500 companies of various sizes.
This is the highest value of the metric for the city-state since the fourth quarter of 2011, suggesting confidence in economic revival this year (though there’s a caveat to that – a bit more about it later in the article).
“As Singapore moves closer to its goal of living with Covid-19, employers are more confident about business prospects moving forward. Coupled with the past year’s strong Gross Domestic Product (GDP) growth, employers in most industry sectors are planning to ramp up their hiring to meet manpower demands,” said Linda Teo, Country Manager, ManpowerGroup Singapore.
Salaries are expected to follow jobs
Just as Singaporean employers are eager to employ, they are also becoming generous this year. 71 per cent of the surveyed companies are planning raises of at least three per cent this year and a whopping 81 per cent expect to give employees bonuses of one month or more.
Notably, nearly one in five employers plans for raises of over five per cent, which means a median salary earner (in 2021 it was S$4,563 per month, including employer CPF) in these companies can expect to make S$2,500 to S$3,000 plus more this year.
Most importantly, even most generous salary increases are not given at the expense of bonuses (or vice versa) – which was a trend in Singaporean labour market in recent years.
This time the companies planning the highest raises are also the most generous with their bonus packages, with a third (32 per cent to be exact) of those planning on giving their employees over 1.5 months pay or more also raising their salaries by five per cent and above.
Where are the jobs and who is most generous?
The nature of statistics is such that it tends to average figures recorded in a highly diverse reality. As a result, there are demonstrable differences between different sectors of the economy, with some faring better than others.
So, where should you look for a job in 2022? Who is hiring? Who is planning to pay the most, giving current employees raises and generous bonuses?
Following the trend from the pandemic itself, the strongest growth sectors are information technology (IT) and finance – both of which have already increased employment in Singapore in the past two years, in spite of the raging pandemic.
The net employment outlook of +38 per cent is the strongest in tech and media companies. Interestingly, manufacturing and construction are just behind banking, suggesting a bounce-back after the turbulent pandemic years.
The only sector that remains pessimistic is hospitality, with full revival of international tourism still uncertain.
“Hiring sentiments in the IT, technology, telecoms, and communications and media sector continue to be bolstered by the strong demand for IT services and digital solutions. Meanwhile, talent shortages, increased Omicron infection numbers, and rising operation costs have clouded business outlooks in the restaurants and hotels sector, forcing employers to recalibrate their manpower strategy,” Linda commented.
Anybody with a technical degree or related experience should do well in this labour market thirsty for more qualified workers. Lowest-entry jobs, however, may not rebound to pre-pandemic levels yet.
This isn’t necessarily bad, as it does force local workforce to seek self-improvement, particularly as exodus of Employment Pass and S-Pass holders left tens of thousands of vacancies that will now have to be filled.
When it comes to raises, the best industries to be in are, again IT, finance, and construction. Notably, those who happen to be working in stable and profitable hospitality establishments can also expect large bumps, as 10 per cent of them are planning to offer increases of seven per cent or more this year.
In other words, while the industry as a whole may not be eager to hire, there are some already sensing improvement coming this year and willing to improve their employees’ paychecks ahead of the incoming workload.
Close to 90 per cent of those employed in banking, trade and construction can expect to receive bonuses of one or more months this year, while the most generous industry is IT, where 16 per cent of companies are planning to hand out over 1.5 months extra.
Growing opportunity gap in IT
One noteworthy phenomenon is the growing gap between qualifications of Singaporean graduates and the rapidly increasing needs of the domestic IT sector.
It’s both an opportunity for candidates and a threat to the entire economy.
As reported in the 2020 Census, despite an ongoing worldwide discussion on the importance of science, technology, engineering, and mathematics (STEM) subjects, fewer Singaporeans decide to take up studies in these subjects.
A decreasing number of Singaporeans had chosen engineering, IT or natural sciences over the decade since 2010. Meanwhile, it’s the tech industry that is both the most generous and eager to employ.
There are many lucrative opportunities which, ultimately, will have to be filled by immigrants or else their employers may seek greener pastures, with larger pools of talent (particularly if sentiments towards immigration into Singapore continue souring).
Some are complaining about lacking prospects in the Singaporean labour market but clearly it’s not a matter of quantity (i.e. jobs not being available) but quality (mismatch between skills and market demand).
Data shows that the most innovative and, at the same time, most generous sectors of the economy are also the ones with the highest appetite for workers. It’s now up to everyone who is trying to find their career path to get their skills up to the required level before vacancies are inevitably filled by someone from abroad.
PS. What about the war?
Since the survey was concluded in early February, it is quite likely that moods have been dampened by now – although we’re going to have to wait to see the real life impact it’s going to have on the global economy.
I think it’s safe to say that the most rapidly growing sectors are not going to see their optimism dented, since they operate largely independently of the global trade – though they may start exhibiting more caution.
IT should remain unscathed, while construction and manufacturing have yet to bounce back to normal levels anyway. Finance reported positive sentiments despite already well acknowledged global economic problems, stemming from high inflation, bear market in equities and cooling measures on Singapore’s property scene.
Local trade and logistics may, in fact, see a boost, given that disruptions to global supply channels – with shipments from Ukraine and Russia either completely severed or significantly obstructed – leaving buyers scrambling to diversify and seek new sources of goods and resources.
Travel and hospitality, however, may receive a blow, given how accelerating inflation may reduce demand for tourism this year, as people try to wait the storm out, looking at how the Russian invasion plays out.
On the whole, while the war is likely to make decision makers more cautious, there’s no question that Singapore and most of the developed world is emerging from the pandemic, returning to business as usual. The only dark cloud on the horizon is the uncertain situation in China, which could face a major outbreak should the recent infections explode like they have in Hong Kong.
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