Singapore Jobs: The Big Chill Begins

Singapore’s labour market is displaying signs of structural cooling as the third quarter of 2025 reveals a simultaneous rise in retrenchments and a decline in job vacancies. Data released by the Ministry of Manpower (MOM) indicates that while total employment continues to expand, the momentum is shifting as businesses adopt a more cautious stance amidst lingering global economic headwinds.

The number of retrenchments climbed to 3,670 in the quarter ending September, up from 3,540 in the previous quarter. More tellingly, the percentage of companies intending to implement redundancies rose from 1.9 per cent in June to 2.3 per cent in September. While officials maintain that the overall rate of retrenchment remains low at 1.6 per 1,000 employees, the underlying trends suggest a tightening environment for specific high-value sectors.

For investors monitoring the health of Singapore’s pivotal industries, the composition of these retrenchments is notable. The job cuts were not limited to struggling legacy industries but were concentrated in growth-oriented sectors, including financial services, professional services, and information and communications. This aligns with broader global trends where white-collar roles, particularly in tech and finance, have faced consolidation after periods of aggressive hiring.

Furthermore, firms are increasingly utilising alternative cost-saving measures to avoid outright dismissals. The number of employees placed on short work-weeks or temporary layoffs increased to 800 in the third quarter, up from 620 previously. This impact was felt most acutely in the manufacturing sector, where non-PMETs (professionals, managers, executives, and technicians) accounted for approximately two-thirds of those affected. This reflects a classic response to "business slack," where hourly-rated employees often face reduced hours before permanent cuts are made.

Perhaps the most significant indicator of market sentiment is the decline in labour mobility. Job vacancies fell to 69,200 in September, a decrease from 76,900 in June. While this figure remains higher than the same period in 2024, the broader trend points to stagnation. Both recruitment and resignation rates are now trending below their 10-year averages.

The Ministry noted that this data "suggests that firms are managing headcount through natural attrition rather than actively laying off workers." Essentially, employees are becoming more risk-averse, switching jobs less frequently due to a perception of fewer opportunities, while employers are slowing the backfilling of roles.

Despite this, the ratio of job vacancies to unemployed persons actually widened to 1.49 in September from 1.35 in June, primarily because the pool of job seekers shrank faster than the number of available roles. Pockets of tightness persist in specific PME roles within the information, communications, and health sectors.

Total employment did manage to grow by 25,100 in the third quarter, more than doubling the growth seen in the second quarter. However, the drivers of this growth were mixed.

Resident employment gains were led by financial, insurance, and health services, while foreign employment growth was heavily skewed toward construction and manufacturing.

Looking ahead, the economic landscape remains complex. "Although economic uncertainties have receded since the first half of 2025, they remain elevated and will continue to weigh on firms, pointing to a moderation of labour demand," the Ministry stated.

As cost pressures mount, organisations are expected to pivot toward flexible talent strategies. Market observers note that rather than committing to full-time headcounts, companies may increasingly rely on contract and part-time labour, or shift workloads regionally to optimise manpower without increasing fixed costs.