6,150 unionised jobs lost in H1, uncertainty looms

THE unionised sector shed 6,150 jobs in the first half of this year - and faces a second half fraught with uncertainty and empty order books.

Echoing gloomy national data, the National Trades Union Congress (NTUC) disclosed yesterday that 4,744 workers were retrenched from the sector in Q1 - the highest quarterly tally since 1998. 'The first quarter of this year was extremely challenging,' NTUC's industrial relations director Cham Hui Fong told reporters.

In the economy overall, 12,600 jobs were shed in Q1 - another record - according to numbers released by the Ministry of Manpower (MOM) in April. Retrenchments in the unionised sector moderated in Q2 when 1,406 workers were axed - a two-thirds drop from Q1. The manufacturing sector bore the brunt of retrenchments in H1, accounting for 75 per cent of all jobs shed.

Professionals, managers, executives and technicians (PMETs) were hit hard, making up 22 per cent of those retrenched, compared with 12 per cent during the Asian financial crisis of 1998.

As for shorter workweeks and temporary layoffs, numbers were also bleak in H1, with 31,177 workers affected - higher than the 14,898 in full-year 1998 and approaching the 45,561 in full-year 2001, post-Sept 11. 'We are pushing for a shorter workweek first to save jobs before firms resort to retrenchment to keep costs down,' said NTUC secretary-general Lim Swee Say.

Most shorter workweeks and temporary layoffs occurred in Q1, before tapering off sharply in Q2.
Despite the more heartening Q2 figures - attributed to the Jobs Credit scheme and improving business prospects in some sectors - the light at the end of the tunnel could well be that of an oncoming train for some industries.

NTUC expects the plastics, machinery, textile and electronics industries to face tougher times in H2 than H1. 'For some of the plastics firms, orders are not coming in after August, and some of them are expecting big losses this financial year,' said NTUC's Ms Cham. 'They will be implementing more severe cost-cutting measures but we do not know the extent.'

The closely watched electronics sector, meanwhile, is expected to provide little solace in Q4, with order books filled only until September. The industry is hard-pressed to project Q4 figures, despite traditionally being able to have a year-end forecast by July.

At the other end of the spectrum, pharmaceuticals and education will do better in H2, says NTUC.
The gloomy business outlook is set to make itself felt in retrenchment figures in H2. In fact, NTUC said unions have been receiving notifications of impending retrenchments and signs of shorter workweeks to come. It expects the next wave of retrenchments to range from the hundreds to the thousands, mostly in the manufacturing sector.

In May, NTUC raised $23.2 million for those affected by retrenchments and shorter workweeks. So far, almost $10 million has been disbursed to the unions in the form of U Care Immediate Assistance, U Stretch vouchers and a scholarship/bursa- ry top-up scheme.

Mr Lim urged unions and firms yesterday to stay the course in helping the sector keep below the 29,000 retrenchments recorded at national level in 1998. 'We need to cut costs and save jobs to prevent record retrenchments for the whole year,' he said. 'We also need to switch gears. The longer we are in the downturn, the more emphasis we should place on new capabilities and growth.'

Source: Business Times, 18 July 2009