43,000 jobs were created in 2009
Unemployment rate fell to 3%
150,000 jobs to be created in 2010

By CHUANG PECK MING

THE final three months of 2009 saw jobs being created at a furious pace. Meanwhile, fewer people are out of work as unemployment fell sharply to 2.1 per cent in December.

Total employment jumped 38,700 in the fourth quarter of last year, up from 14,000 in Q3 and 21,300 in Q4 2008, according to preliminary figures released yesterday by the Ministry of Manpower (MOM).

This is the biggest number of jobs created in a quarter since Q3/2008.

'The figures released reflect the increased activity that we've seen in Adecco offices over the past few months,' says Lynne Ng, regional director of Adecco Southeast Asia, a human resource and staffing services firm.

'Clients have been particularly active in looking at how they can bring on headcount to manage their increasing human resource requirements,' she says.

For the full year, total employment rose 38,800 in 2009, as job gains in the second half more than offset the losses in the first six months of the year.

MOM's latest employment situation report attributes the job gains in Q409 to hirings for the year-end festivities and the integrated resorts. Economist also point to the Jobs Credit scheme.

'Apart from the IR-related hiring, the other obvious factor boosting the labour market has been the government's Jobs Credit scheme, which was introduced early last year,' says Robert Prior-Wandesforde of HSBC Bank.

Adds Kit Wei Zheng of Citigroup: 'Jobs Credit may have tilted the balance towards the hiring of locals.'

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The report says that out of the net jobs created for 2009, 43,000 jobs were created for locals, while 4,200 foreign jobs were lost.

Mr Prior-Wandesforde says that the falling cost of labour might have also contributed to the job boost.

'Monthly 'earnings' (wages and bonuses) have been falling during 2009 - probably by around 2.5 per cent on average in the year as a whole,' he says.

Services, which added 32,100 workers in Q4, provided the bulk of the employment gains. For the full year, services employment rose by 56,100.

Construction created 4,700 jobs in Q4, taking its total to 25,200 for 2009.

Manufacturing jobs jumped by 1,400 in Q4, the first increase after four straight quarters of decline.

But the gains were not enough to offset the earlier losses, resulting in 43,000 jobs lost for manufacturing in 2009.

'Although job growth in the service sector was strong, there is clearly still much to be done in the manufacturing sector,' says Adecco's Ms Ng.

'Productivity enhancements may go some way to providing remedies to get manufacturing growth back on track,' added Ms Ng. Redundancy - layoffs and premature termination of contracts - continued to fall for the third quarter in a row in Q4, with 1,500 workers axed. In Q3, 2,470 workers were made redundant. The figure was 9,410 in Q4, 2008.

For the full year 2009, the redundancy was 22,700 workers, still higher than in 2008 when 16,880 were made redundant.

Manufacturing accounted for 59 per cent of the redundancy and services 36.6 per cent. 'With the strong employment growth, the seasonally adjusted overall unemployment rate improved significantly to 2.1 per cent in December, from 3.4 per cent in September,' the report says.

Among the resident workforce - Singaporeans and Permanent Residents - the jobless rate fell from 5 per cent to 3 per cent. The unemployment rate for the full year was 3 per cent in 2009, up from 2.2 per cent in 2008.

Economists expect to see continued job creation ahead, but not as strong as in 2007 and 2008 because of the tightening of entry of unskilled foreign workers.

Citigroup projects 150,000 jobs to be added in 2010, against more than 200,000 for 2007 and 2008.