Retrenchments between April and June saw a sharp drop, compared to the first three months of the year. But the labour movement warns of further job losses ahead in its mid-year update on the unionised sector.
In the first half of this year, 31,177 workers were placed on shorter work weeks or were temporarily laid off as companies sought ways to cut costs.
Between January and March, there were 24,135 workers affected, but this number dropped sharply to 7,600 workers between April and June.
Retrenchment numbers saw a similar improvement over the same period. 1,400 workers lost their jobs in the second quarter of this year, compared to 4,744 in the first quarter – mostly from the manufacturing sector, followed by services.
The National Trades Union Congress (NTUC) said this is partly due to business picking up in some sectors of the economy, such as electronics and chemicals. Some companies also wanted to hold on to their workers, in case the economy recovers.
Government measures like the Jobs Credit Scheme and the Skills Programme for Upgrading and Resilience (SPUR) also helped companies reduce their wage costs.
NTUC said compared to the Asian Financial Crisis a decade ago, companies are more willing to try out other cost-management solutions.
For instance, the number of workers affected by shorter work weeks and temporary layoffs so far is more than double the total number in 1998 when retrenchment figure hit 29,000 nationwide.
But with so much uncertainty in the economy, NTUC expects a second wave of job losses in the second half of the year.
NTUC's Secretary-General Lim Swee Say, who is also a Minister in the Prime Minister's Office, said: "Do not assume that retrenchments will stop. Retrenchments will not stop. We hope it will be as low as in the second quarter, but we cannot assume."
The labour movement said based on company feedback, retrenchment numbers may run into the hundreds or even thousands. More workers are likely to be put back on shorter work weeks, and may well face a wage cut or a wage freeze.
NTUC's message to companies is to press on with flexible work arrangements and worker training.
"Cutting costs to save jobs can only enable us to buy time... But having bought the time, having found a way to keep this excess manpower, we must turn this excess manpower into an investment in new capabilities," said Mr Lim.
NTUC added that companies in the plastics, machinery and textile sectors, which were already badly affected in the first half of the year, are expected to do even worse in the next six months.
On the other hand, those in construction, retail and healthcare have a more optimistic outlook.
- Channel News Asia
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