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Breaking News: MOM’s 2nd quarter report on employment

The Ministry Of Manpower (MOM) has issued a press release on the employment situation for the second quarter. The release is titled: "EMPLOYMENT SITUATION IN SECOND QUARTER 2007: Continued record employment growth with sharp fall in unemployment".

(View the press release here, in PDF file.)

Leong Sze Hian has some questions.

The MOM's report says:

"Among the resident labour force, the non-adjusted unemployment rate was 4.2%, also higher than 3.4% in March 2007 but lower than 4.5% in the same period a year ago. An estimated 79,600 residents were unemployed in June 2007. The seasonally adjusted figure was 63,000".

The estimated 79,600 unemployed residents is higher than the estimated 66,000 last quarter.

And since the report also says:

"Preliminary estimates show that total employment grew by a record quarterly high of 61,900 in the second quarter of 2007, as the economy continued its strong growth. This is substantially higher than the increase of 49,400 in the previous quarter and 36,400 in the same quarter a year ago,

...reflecting the increase in job seekers as this year’s batch of tertiary graduates entered the labour market and students looked for work during the mid-year school vacation",

Why is it that the estimated number of unemployed residents increased to 79,600?

61,900 new jobs - (20,000 tertiary graduates and student vacation job seekers?) = 41,900 new jobs that went to foreigners? (not counting the 13,600 increase in unemployed residents)

What is the percentage now of new jobs going to residents (Singaporeans and PRs)? Around 32% (20,000 divided by 61,900)?

...to Singaporeans? Around 27%?

Dividing the estimated 79,600 unemployed residents in June 2007 by the non-seasonaly adjusted resident unemployment rate of 4.2%, gives the figure of 1,895,238. Does this mean that the resident labour force is 1,895,238?

Similarly, dividing the estimated 66,000 unemployed residents in March 2007, by the unemployment rate of 3.4%, is 1,941,176. Does this mean that the resident labour force shrunk by 45,938 (1,941,176 - 1,895,238) in the last quarter, despite a record quarterly high total employment growth of 61,900?

Why do ordinary citizens like me have to guess the statistics?

Read also Sze Hian's article titled: Leveling the playing field for residents and non-residents.

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"Concepts and Definitions" - from the press release

Unemployed Persons refer to persons aged 15 years and over who were without work during the survey reference period but were available for work and were actively looking for a job. They include persons who were not working but were taking steps to start their own business or taking up a new job after the reference period.

Unemployment can have frictional, cyclical and structural elements. As it takes time for job seekers and employers to find a match, there is always a certain level of frictional unemployment due to people changing jobs and from new entrants looking for work for the first time.

Unemployment can also be structural e.g. arising from a mismatch between the job seekers and the job openings available.

With structural unemployment, even if job vacancies and job seekers coexist in the labour market, they may not be matched over a long period of time. Finally, unemployment can be cyclical. This occurs when there is a general decline in demand for manpower as aggregate demand for goods and services fall in the event of a cyclical downturn.

Unlike structural and frictional unemployment where the problem is in matching job openings with job seekers, cyclical unemployment occurs when there are not enough jobs to go around.

Unemployment can vary due to changes in demand or supply of manpower. It can decline if more people succeed in securing employment or when the unemployed persons stop to look for a job and leave the labour force either temporarily (e.g. to take up training) or permanently (e.g. to retire).

Conversely, unemployment may rise due to increase in labour supply from new entrants or re-entrants to the labour market. It will also rise if more people quit their jobs to look for alternative employment or if there is an increase in layoffs."