Thoughts from Moscow.
July 23, 2013
Many of us have been reading articles about the sluggish economies in the world as well as the concerns over unemployment. These worries were clearly shared by many of my counterparts at the G20 meetings last week in Moscow, both at the formal sessions and on the sidelines. The financial crisis in 2008 had taken its toll and for a number, recovery has been slow and the impact, on the lives of those affected, remains stark, especially for the young. Job creation was repeatedly echoed as an imperative and youth unemployment was flagged up for special attention. We have been reading for a number of years now about the ‘lost generation’ in Europe and even in the US. The concerns have not abated. Real wages have stagnated. In the US, this has been so for the past few decades. Income inequality also weighs heavily on the minds of the policy makers.
What are the solutions? Be it Governments, social partners, or international organisations at the meeting, most were clear that it was only with good economic growth that jobs could be created. And when there are jobs and better employment, more resources could be generated for the respective countries’ budgets for assistance and skills programmes. Some shared that businesses were complaining about young people who lacked the skills that jobs required; hence there was also the need to create a bridge via further education and training.
These are some fundamentals that drive all economies, and we are no different. But we are, in a somewhat more fortunate situation. When asked, I shared with some about our dilemmas and what we were doing. More than a few did a double-take when I shared that we were moderating the pace of development in order to achieve more sustained and inclusive economic growth. ‘How do you know how much to slow down by?’, some asked. I acknowledged that it was not a precise science, but we needed to ease off our previous rate of growth to something more manageable and which our infrastructure can support.
We have a number of plus-es on our side at the moment. We are creating more jobs than there are Singaporeans to fill them and could possibly ease that off a little. We remain an attractive destination for companies, both foreign as well as local. One could say that we can ‘afford’ to forego some of the opportunities that will have to pass us by.
But we need to be careful. I have often said that economic growth is not a bad word (two words actually!) and that one should not pursue it for its own sake, or to chase after it at all cost. Economic growth is needed in order that jobs continue to be created and good opportunities generated for our people. Too slow a growth can cause us to stagnate and in turn impact our people’s welfare, and affect our ability to provide for our nation’s needs.
As I sat there listening to the sharing by others, it felt somewhat surreal because Singapore is not facing these same issues today. But these are stark realities that grip many countries and we will be remiss to think that life as we know it will always continue as is, and the good times will continue to roll. We may not be spared if we do not ready ourselves when the economic tides change, and if we weaken the fundamentals that have brought opportunities to many of our people.
Notwithstanding our reasonably healthy state of affairs, low unemployment doesn’t mean no unemployment. No country can ever have zero unemployment. For those who continue to seek jobs, it is scant consolation to them that our unemployment rate at 2% or 3% is the envy of the rest of the world. To the individual job seeker, until he or she finds a job, unemployment is 100%.
Our approach has provided jobs for most and wages that have been slowly creeping uprather than stagnating. Let us be careful not to undermine that which has provide for the broader interests of our people. We will have to continue to ensure that the economy grows reasonably so that good jobs and opportunities are created. We must enable our people to be equipped to take on those jobs via the foundations laid by education and built upon via Continued Education and Training (CET).
We sometimes debate issues with little regard for what is happening elsewhere, and ignore dynamics that drive countries and their economies. Observing the world around us reminds us of what can happen if we are not careful.
Source Link : Thoughts from Moscow
Employment Situation. Second Quarter 2013
As I had shared in my earlier note ( Thoughts from Moscow. ), we are in a relatively healthy state with regards to jobs for our people. MOM’s latest employment situation report released today saw unemployment edging up, but still remaining at a low level (overall: 2.1%; resident: 3.0%; citizen 3.1%). As we restructure our economy, we can expect to see more redundancies. This will be a recurring theme in the coming years.
As such, job creation, job training and job matching will be important. Those who need assistance can approach CaliberLink or any of the five WDA career centres located at neighbourhood Community Development Councils (CDCs), and NTUC’s Employment and Employability Institute (e2i). They can also sign up for Place-and-Train Programmes supported by WDA, where eligible individuals undergo subsidised training, receive training allowances, and will be placed into jobs.
As you can see, our businesses are still relying too heavily on labour. Total employment growth so far in 1H 2013 was 61,400, higher than the 58,900 in 1H 2012. At this rate, total employment as at June 2013 grew by 4.0% from a year ago, which is more than double the 1 to 2% desired for this decade. Is it any wonder that productivity continues to be less than desired? We need to moderate employment growth to a more sustainable pace, and encourage companies to move towards manpower lean growth. These efforts will have to continue.
On our workforce, I am acutely aware of the increasing aspirations of our younger Singaporeans, especially as education level increases. We will need to continue to create good jobs and opportunities by having quality growth and keeping the labour market diverse and dynamic. At the same time, I am mindful that we also have to keep the playing field level. The tensions pull in different directions but we need to manage the balance so that things are ultimately better for our people and society. We will continue to invest in continuing education and training.
Businesses will have to scale up their productivity plans and actively nurture Singaporeans to take on higher level jobs. Singaporeans will have to maintain a healthy work ethic, stay agile and ensure that education and training is a lifelong pursuit…alongside our many other pursuits in life.
MOM released the Employment Situation, Second Quarter 2013 report today.
Unemployment edged up, though it was still low and employment creation remained high.
Layoffs have increased and there may be more workers affected, as we restructure our economy.
But, we will continue to help jobseekers find employment quickly. Read more in the Employment Situation, Second Quarter 2013 report here : http://bit.ly/xU4e8E