By Amanda Lee and Fabiana Negrin Ochoa


SINGAPORE--Singapore's employment rose for a tenth straight quarter, but continued losing momentum, with labor demand cooling as global economic risks persist.

Total employment, excluding migrant domestic workers, rose by 4,900 in the first three months of the year, according to advance estimates from the Ministry of Manpower on Tuesday. That compared with an increase of 7,500 in the fourth quarter of 2023.

The first-quarter growth was driven entirely by a rise in employment among residents amid moderate tightness in the labor market, the ministry said in a statement.

Retrenchments fell for the second consecutive quarter to 3,000 in the first quarter from 3,460 in the final quarter of 2023.

"Business reorganisation/restructuring remained the top reason for retrenchments," the ministry staid.

Singapore's overall unemployment rate edged up slightly in March to 2.1%, the ministry said.

"However, we do not expect sustained increases in unemployment rates, given continued labor market tightness," the ministry added.

March unemployment rates among residents and citizens were at 3.0% and at 3.1%, respectively.

The Ministry of Trade & Industry's advance estimates showed that Singapore's economy is expected to improve this year, said the Ministry of Manpower.

"Labour demand, which tends to lag economic growth, should strengthen correspondingly," it added.

Estimates earlier this month showed that gross domestic product expanded 2.7% in the January-to-March period from a year earlier. That was faster than the revised 2.2% growth posted in the final quarter of 2023.

Forward-looking polls by the Ministry of Manpower signal improved hiring demand, with over half of firms indicating an intention to hire in the next three months. Still, wage improvements could slow, as the proportion of firms expressing an intention to raise wages declined.

The labor data was broadly in line with expectations of Barclays economists, who had expected unemployment to stay low and stable.

Continued signs of tightness in the labor market could underpin expectations that inflation will stay high for a while yet.

Analysts at BMI, a unit of Fitch Solutions, note that unemployment has been hovering near historic lows.

That could contribute upward pressure on prices, offsetting the impact from the continued fall in import prices that typically precedes a decline in core inflation--the Monetary Authority of Singapore's preferred gauge of inflation, BMI wrote in a note.

Longer term, the effect of slowing wage growth will become more apparent, helping bring down inflation, BMI expects.

"Additionally, we expect a slight uptick in the unemployment rate to 2.4% by end-2024, further contributing to the downward trend in core inflation," it said.

Most likely, the central bank will keep policy settings tight through the year, BMI said.


Write to Amanda Lee at amanda.lee@wsj.com


(END) Dow Jones Newswires

04-29-24 2244ET