SINGAPORE — As a fresh polytechnic graduate, retrenchment was the last thing on Mr Y C Tan’s mind when he first started work as a junior game designer. But barely 15 months into the job, he was among three in four employees let go by the studio in June.
The report also showed that among resident workers, the incidence of retrenchment per 1,000 employees rose the highest over the quarter period for younger workers, reaching closer to that of their older counterparts.
For example, the number jumped from 0.8 in the last quarter of 2022 to 2.2 in the first quarter of this year for workers below the age of 30, and from 1.2 to 2.0 for employees aged between 30 and 39. In comparison, retrenchment incidence among workers aged 50 to 59 remained the same at 2.3.
Some young, former employees shared with TODAY how layoffs impacted them.
An engineer in his 20s, who gave his first name as Muhammad, was made redundant this year during his company’s retrenchment exercise, less than a year into the job — his first since graduating from university last year.
Though he had tried to brace himself as best as he could for D-Day, as the impending layoffs were “announced beforehand”, he still felt the shock when the moment arrived.
“I was pretty much at a loss for words and was just trying to mentally calm myself down,” he said.
“Questions like ‘why me?’ ran through my mind, but I couldn’t bring myself to ask them. Perhaps because I knew they wouldn’t give a proper answer anyway.”
THE BIG PICTURE
While historical numbers show that retrenchments typically peak during recessions — with many years or even a decade in between each — business and human resource experts were hesitant to conclude that business cycles are now getting shorter.
The recent layoffs, they noted, were largely confined to a few sectors, namely electronics manufacturing, information and communications, and financial services. Within these industries, while some companies may have done multiple rounds of reducing headcount due to specific challenges, there is little data to definitively show how widespread this practice is.
Associate Professor Walter Theseira, a labour economist from the Singapore University of Social Sciences (SUSS), said: “The incidence of retrenchments is still significantly below that of past serious shocks such as the Global Financial Crisis and might be considered to be only slightly above the ‘normal’ level of retrenchments.”
As to why a larger proportion of younger workers seem to be affected in recent layoffs, analysts attributed this to the concentration of younger employees in such companies and industries, rather than any vulnerability due to their age.
More importantly, experts noted how younger workers are getting back on their feet relatively more quickly than their older counterparts.
Among retrenched residents, 83.9 per cent under the age of 30 found new jobs within six months of being laid off. The proportion is 77.9 per cent for those between 30 and 39, 59.6 per cent for those aged 40 to 49, and 49.4 per cent for workers aged 50 to 59.
Experts cited various reasons for this, such as how on the job supply side, junior roles tend to be more readily available. Younger worker also tend to be more willing to reach out for help and tap one’s network to find work opportunities.
“High re-entry rates for younger retrenched workers is a feature that predates the current tech industry cycle,” said Assoc Prof Theseira.
At the same time, the figures also showed why retrenchment of older workers is “a large policy concern”, he added.
THE BOTTOMLINE
Chief economist and head of treasury research and strategy at OCBC Bank Selena Ling said that companies hiring and firing more quickly in response to market conditions “is not necessarily a negative thing, because if firms are more agile, they may be better positioned to survive the challenging times”.
However, she acknowledged that such a situation would be “unsettling from the worker’s perspective”.
Economists and business experts told TODAY that there can only be so much that can be done to save jobs or forestall retrenchments, as companies and the economy need to respond to changing market conditions.
However, to help workers, they urge the Government to continue support in retraining, skills upgrade and job matching for displaced workers, as well as helping companies in job redesign.
Providing “subsistence” for displaced workers while they retrain and job search would also be ideal, said some experts.
Meanwhile, individuals should continue to invest in themselves in terms of skills and professional network.
“While this won’t entirely prevent redundancies, it broadens your choices and enhances your overall value to prospective employers,” said Mr John Doyle, associate partner at recruitment firm Page Executive Singapore.
Assoc Prof Theseira added: “Having a combination of individual resilience — that is, having savings to tide over, updated industry networks and skills, and so on — and societal resilience policy — that provides income support and training and job search support — is vital.
“Both are necessary to help workers bounce back from retrenchment.”