By Joshua Yim
CEO, Achieve Group
With their prime position at the forefront of the jobs market, recruitment agencies have always been a good barometer of the economy. When the market is on an upswing, companies will be hiring. When sentiment turns negative, businesses won’t be in expansion mode, often suspending capital expenditure including a headcount freeze or even retrenching workers. And there will be less movement in the jobs market as employees also hold onto their jobs for security.
We at Achieve Group forecast that 2018 will be a good year for the global economy, and this will translate to an equally positive outlook for Singapore, with a lot of hiring activity and ample jobs available across industries.
Officially, the Ministry of Trade and Industry (MTI) has forecast growth of between 1.5 per cent and 3.5 per cent for 2018, while many private sector economists are predicting growth of 3 per cent for this year.
This was reinforced during the Budget 2018 announcement by Finance Minister Heng Swee Keat, who stated that the Singapore economy expanded 3.6 per cent for the whole of 2017 – more than double initial forecasts.
He attributed this to an upswing in global growth and indeed, the world economy appears to be stabilising, with things picking up from mid last year and gaining in momentum since. Additionally, global demand for electronics goods has increased quite significantly, and with manufacturing a key driver of Singapore’s GDP, this bodes well for our economy.
Global And Local Outlook
Before we share our forecast for the 2018 Singapore recruitment trends, let’s look at the global situation and key fundamentals in place leading up to this point.
In general terms, this will be an interesting year because there hasn’t been a time in history where all the major economies are stable and doing fine since the financial tsunamis of 2008.
Flashback to the 2016 presidential elections in the United States. As the world’s largest economy, the US plays a very significant role and the performance of its domestic market has a great impact on the global economy. Although people feared the economy would not do well if Donald Trump was elected president, the contrary happened, with the stock market soaring, and the US economy has been positive since.
In China, there were dangers of overcapacity from 2014 to 2016 and the stock market was doing badly at the time. But China managed to avert a recession while cleaning up corruption. Following the consolidation of power at the 19th National Congress of the Communist Party of China in 2017, China is now moving forward full steam ahead.
In Japan, “Abenomics” appears to be taking effect, with the monetary easing, fiscal stimulus and structural reforms getting the country back on its feet again.
Europe, with various regions mired in political upheaval in recent years, finally appears to be pulling their act together and stability is also returning to their various economies.
So these stabilising forces have had a positive effect on the Singapore economy, which has likewise been experiencing good growth.
Singapore Recruitment Trend for 2018
What’s ahead for 2018? Here are our predictions for the Singapore economy, jobs market and recruitment trends this year:
Star sectors:
1) Manufacturing leads the Singapore economy, making up 19.2% of Singapore’s GDP. So when manufacturing is up, the whole economy is up. Manufacturing figures have been up for a few cycles and this trend is likely to continue.
According to latest figures by MTI, manufacturing surged 10.1% in 2017. We believe it will continue growing at a brisk pace this year and will be the star of 2018 with a lot of hiring activity in this sector.
2) All sectors that support infrastructure development will also do well, as the government has been investing in various initiatives in areas such as land transport.
3) IT and Infotech-related services, portfolios and roles have been in the limelight recently, with the government pushing hard to promote start-ups, and calling for more skills development and courses in this area. Roles from cyber security to fintech will therefore continue to be in high demand.
4) Banking & Finance will also see good hiring prospects, but more so in the area of fintech, with a lot of start-ups on the scene benefiting from venture capital injections.
Evergreen sectors:
The usual suspects of Healthcare, Education and Pharmaceutical are the evergreen industries that will always be in need of workers.
Moderate sectors:
1) Aviation is another area supported by the government, so we anticipate manpower needs in this sector will be moderate to high in 2018.
2) Professional services are closely tied to the economy as they include supportive services for businesses like accounting and marketing communications. So if the economy is up, then demand will be high.
3) Similarly, we expect the demand for Lifestyle services to go up because when the economy is doing well, people will spend more on amenities and entertainment.
4) Construction has been in the doldrums for quite some time, as property prices (residential in particular) have been depressed and therefore serving to discourage developers from building new projects. According to the latest MTI report in February, Construction shrank 5% in 2017.
However, the government has increased spending for infrastructure development, while the effects of the recent spate of en blocs will come through only next year. Therefore, we believe Construction will be low to moderate for 2018.
Least active sectors:
1) Oil & Gas has picked up a bit, with oil prices now around $60. But the question is, can this be sustained? We don’t expect a lot of hiring activity here but we hope to see this sector stabilise.
2) Retail has been greatly hit by the proliferation of online sales and e-commerce, so we also anticipate less hiring for traditional retail businesses.
How will all these affect SMEs, which make up the majority of Singapore businesses?
Relative to MNCs, SMEs generally have less muscle to weather adverse conditions or capitalise on a favourable economic climate. But we believe there will be greater opportunities for growth and advancement if SMEs are able to venture overseas.
Given the rising cost of doing business in Singapore and the small size of the domestic market, the government has been continually rolling out initiatives to support and encourage SMEs to expand overseas. Companies should therefore make the most of the available support.
Additionally, with Singapore as the ASEAN chairman for 2018, local companies ought to capitalise on this and seek out opportunities to ride on this fanfare and expand abroad.
Singapore has long been regarded as the unofficial capital of ASEAN, as New York is to the United States and Shanghai to China. With the region’s continued strong growth prospects, many companies are still using Singapore as a springboard to other parts of the region. Therefore, we forecast higher growth in external hiring for overseas posts compared with local placements.
Correspondingly, this will bode well for Singapore’s jobs market and it is an opportune time for workers looking for good opportunities to advance their careers and for personal development. There will be a lot of opportunities to choose from so jobseekers can make a move – without having to worry about the ‘last in, first out’ syndrome.