Singapore's jobless rate drops to 3-year low as growth quickens

Singapore’s unemployment rate fell to the lowest level in three years as employers expanded payrolls to meet demand for goods and services in an accelerating economy.

The seasonally adjusted unemployment rate fell to 1.9% in the three months through March from 2.2% the previous quarter, the Ministry of Manpower said in a statement today. That’s lower than the median estimate of nine economists surveyed by Bloomberg News for a rate of 2%. The economy added an estimated 23,700 jobs last quarter, it said.

Singapore, ranked by the World Bank as the easiest place to do business, has cut taxes in recent years to encourage investment in the city state. Intel Corp. and Micron Technology Inc. are among companies that are setting up or expanding capacity on the island as the government aims to attract as much as $14 billion of investments this year.

 

“We may see about 100,000 jobs created this year,” Chua Hak Bin, a Singapore-based economist at Bank of America Merrill Lynch, said before the report. “With the economy near full employment and demand for workers remaining pretty strong, wage pressures will become a bigger issue in coming quarters.”

 

The services industry added 22,800 jobs last quarter, while manufacturing companies reduced payrolls by 500, the report showed, citing preliminary data. Construction employment rose by 1,100 in the three months through March, the government said.

 

Companies added about 116,000 jobs last year when the economy grew a record 14.5%, and 59,700 of the new positions created went to foreigners, the Ministry of Manpower said last month. Gross domestic product rose at an annual rate of 23.5% last quarter from the previous three months, when it climbed 3.9%, the trade ministry said April 14.

 

Singapore Prime Minister Lee Hsien Loong, who’s seeking to extend his party’s rule in elections next week, defended the government’s immigration policy on April 21, saying the influx of foreign workers has boosted the economy and citizens have not been disadvantaged by the labor strategy.