S'pore expected to feel bite of U.S. economic slowdown

S'pore expected to feel bite of U.S. economic slowdown

SINGAPORE (AFP): Unemployment in Singapore is forecast to rise
sharply this year as retrenchments increase and job vacancies
fall due to the impact of the U.S. economic slowdown, the
government said on Wednesday.

An improvement in the unemployment rate to 2.4 percent in the
March quarter from 2.9 percent the previous quarter is expected
to be shortlived as new graduates flood the market this June, the
ministry of manpower said in a report.

"The slowing economy has started to affect the Singapore
labor market. Nearly all indicators point to slackening in the
labor market," the ministry said.

"The entry of this year's cohort of tertiary graduates and the
expected weakening in labor demand is likely to aggravate the
labor market conditions in the months ahead," it added.

It cited a survey of business expectations by the statistics
department and the economic development board which warned of
further deterioration in business conditions for the key
manufacturing sector.

This suggested "dismal employment prospects ahead," the
ministry said.

Companies in the electronics and precision engineering sectors
which were badly hit by the global downswing expect to further
cut staff in the second half, it said.

"Overall manpower demand will falter if economic conditions
continue to soften and the weakness spills over to services," the
ministry said, noting a 20 percent drop in media advertising in
April from the previous month.

In the three months to March, 3,248 workers were retrenched --
higher than the average 1,900 registered in the last three
quarters of 2000.

This reflected the weakness in global demand for electronics
products and the faltering U.S. economy -- a major market for
Asian exports, the ministry said.

But the retrenchments are still lower than the 7,000 to 8,000
workers laid off per quarter during the Asian financial crisis in
1998, the ministry said.

Job vacancies fell to 19,755 in March from 22,115 in January,
with the ratio falling to 0.76 job openings for every 100 job
seekers in March, from a high of 1.14 in September 2000.

Economists project Singapore's economic growth this year to be
at the bottom end of the government's 3.5-5.5 percent forecast,
from a sizzling 9.9 percent last year.