Labour Shortage in Singapore

The media reported that coffee and kaya toast chain Ya Kun was trying for four months to recruit eight waiters and cleaners for an outlet it wanted to open at Singapore Flyer, but without any success.  As a result, it was unable to commence operations there.

Driven by Singapore’s rapid and robust economic recovery, job vacancies rose to 50,200 in September 2010 from 45,100 in June 2010 and 36,900 in September 2009.  (The seasonally adjusted vacancies in September 2010 were 44,600, down from 45,400 in June 2010.)  43,400 of the vacancies in September 2010 were from the private sector, while the remaining 6,800 were from the public sector.  Job vacancies were 2.8 per cent of total manpower demand in September 2010.

The highest number of vacancies was for service and sales workers (10,330), professionals (8,270) and associate professionals and technicians (8,230).

In terms of the three broad occupational groupings, employers were most looking to hire professionals, managers, executives and technicians (44 per cent), clerical, service and sales workers (29 per cent) and production and transport operators, cleaners and labourers (27 per cent).

Companies such as Ya Kun which cannot find enough workers should firstly ask themselves whether they are paying enough and whether working conditions are good enough.

For too long, Singapore has relied on importing hordes of cheap (relative to Singapore wages) foreign workers to fill the ranks of its labour force.  But, it cannot continue.

Labour, just like capital and facilities, is a factor of production.  Companies that cannot obtain enough new capital to grow have to generate capital internally or grow more slowly or not at all.  Companies that want land or premises for their buildings must compete with other companies to bid for them.  There is no reason why labour should be an unlimited, or an almost unlimited, resource.  If a company cannot raise its wages or make working conditions more appealing or do whatever is required to secure the employees that it needs, the choices that it faces are clear — do something else or slow down, shut down or move out.

No businessman blames the government or anyone else if he cannot obtain funding or land or premises for his operations.  There is no reason to blame the government or anyone else if he cannot recruit enough employees.

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Notes

1.  "Job Vacancies Soar to Record Levels", The Straits Times, 29 January 2011.

2.  "Job Vacancies 2010", Ministry of Manpower.

The Plight Of The Under-Employed

For many people, the concept of employment seems straightforward.  If a person receives an income from work, he is employed; otherwise, he is unemployed.

In practice, not many people are familiar with how employment, unemployment and under-employment are measured.

What does being employed mean?

According to the guidelines recommended by International Labour Organisation, a person is employed if (among other things) he performed some work for pay, profit or family gains during a specified full calendar week.  For operational purposes, the notion of "some work" is usually interpreted as work for at least one hour.

Working as little as one hour (or even five or ten hours) in a week is fine if it is due to personal choice e.g., students, home-makers or the semi-retired working part-time because of personal commitments such as studies or minding children or preference.

But there are other people who work part-time for economic reasons (that is, not by choice) and are available for, but cannot find, more hours of paid work.  The fewer hours they work, the less they see themselves as being employed.

Governments consider these people to be under-employed, which is a sub-set of the employed.

As at June 2009, 156,200 residents were part-time employed (defined as anyone working less than 35 hours a week), constituting 8.4 per cent of the resident workforce.  Of these, 80,500, or 4.3 per cent of the resident workforce, were under-employed.

The US includes its under-employed in alternative, more comprehensive measures of unemployment (the combined unemployment and under-employment rate was 16.0 per cent last month, compared to the official unemployment rate of 10.0 per cent).  It recognises that the under-employed are inadequately employed.

Most of our under-employed residents had a monthly income from work of $1,200 or less.

They are almost indistinguishable from the 275,000 full-time employed residents with a low monthly income from work of $1,200 or less, except in one significant regard — they represent an under-utilised productive capacity of the employed population, and have the potential and the willingness to work more, contribute more and earn more, if only they had the opportunities.