Singapore Employment Grows in Q2 2026 Even as Retrenchments Rise to Highest Since 2020

The number of retrenchments increased to 4,500 from 3,830 in the previous quarter, while the incidence rose from 1.6 per 1,000 employees to 1.9. The increase was driven mainly by business restructuring in selected outward-oriented sectors such as information and communications, and manufacturing.

Nevertheless, quarterly retrenchments remained “well below levels typically seen during periods of downturn”, MOM said. For comparison, retrenchments ranged from 5,980 to 12,760 during the global financial crisis and from 5,640 to 9,120 during the Covid-19 pandemic.

DBS senior economist Chua Han Teng said the ministry’s forward-looking indicators suggest that “future layoffs should remain contained” even as businesses restructure in response to the rapidly evolving economic landscape. A 49 per cent jump from Q1 to Q2 reflected restructuring across sectors, which a Straits Times report attributed partly to areas such as policymaking and stakeholder engagement in public sectors continuing to rely on human judgment even as artificial intelligence automates other tasks.

Total employment grew by 10,700 in Q2, up from 9,400 in the previous quarter, and broadly similar to the 10,400 increase recorded in the same period last year. The expansion was mainly driven by non-residents in the construction and manufacturing sectors.

Resident employment also continued to increase, mainly in essential and public services, though MOM noted the growth was slower than in the previous quarter.

Unemployment rates remained low and stable in June. The overall and resident unemployment rates stood at 2 per cent and 2.9 per cent respectively, unchanged from March. The citizen unemployment rate edged down to 3 per cent from 3.1 per cent over the same period.

MOM said that forward-looking indicators improved in June, suggesting that labour demand remained “resilient” even as firms stayed cautious amid economic uncertainty and continued business restructuring in some sectors.

The share of firms expecting to hire over the next three months rose to 43.9 per cent in June from 40.6 per cent in May. The share expecting to raise wages increased to 29.3 per cent from 23.7 per cent over the same period. Meanwhile, the proportion of firms expecting to retrench fell to 2.7 per cent from 3.2 per cent.

MOM cautioned that “although the uptick in hiring and wage sentiment was broad-based across sectors, these indicators remained below their pre-crisis levels in February”, referring to the energy shock triggered by the Iran war which broke out in late February. Firms will likely continue to adopt some caution with their hiring and wage decisions in the near term, amid headwinds in the global economy and rapid technological change.