Previously, it was announced that Singapore is in a technical recession.
Basically, it means that our economy has shrunk two quarters (Jan to Mar + Apr to June) in a row.
When we compare the first quarter of the year and the second quarter of the year, our GDP decreased by 41.2%. And if we compare last year and this year, our GDP decreased by 12.6%.
Then, the Ministry of Manpower (MOM) revealed the retrenchment and unemployment figures for April to June 2020, and let’s just say it wasn’t pretty.
Retrenchment has increased by 108%, overall unemployment has increased by 0.5% and the number of jobs available here has shrunk by 121,800.
Yes, more than the 100,000 jobs, skills training and traineeships promised by the government.
Reader Bao: Omg, will you guys fire me from being a reader?
Well, technically, you don’t get paid so…
Reader Bao: Yeah, but at least I don’t have an employment gap to explain away when I’m interviewing for a new job.
Reader Bao: Anyway, isn’t it time for some good news? *Puppy Eyes no Jutsu*
Well…we can still drink bubble tea?
Reader Bao: SCORE!
Okay, that aside, I have more bad news for you.
Everything About MTI’s Announcement About ‘Deeper Recession’ Simplified for You
Just today (11 Aug), the Ministry of Trade and Industry (MTI) announced that Singapore has gone into a “deeper recession”.
So what is a deeper recession?
According to Collins Dictionary, a deep recession is a period where a country’s economy is doing very badly.
In the case of Singapore, it merely means that MTI has come up with charts and formulas to predict how Singapore’s economy will fare (in the case of Covid-19, drop).
Then, it gets worse than expected, and voila: a deeper recession.
Kind of like, we’re in deeper trouble than we thought.
So here are the numbers to justify MTI’s announcement:
- Full-year economic outlook: GDP to drop by 5 to 7% (Previously, MTI predicted a drop of 4 to 7%)
- Economic contraction for 2nd quarter: 13.2% (Previously, MTI expected a fall of 12.6%); this is Singapore’s worst economic contraction to date (even worse than SARS)
- GDP contraction in the first half of 2020: 6.75% (MTI-estimate: 6.45%)
- The economy shrunk by 42.9% in April to June 2020 compared to 41.2% in Jan to Mar 2020.
Factors That Resulted In This
The plunge in the second quarter of 2020 is partly fuelled by Circuit Breaker measures which happened from 7 Apr to 2 Jun 2020.
In addition, Singapore’s external demand outlook (how many people around the world wants to buy Singapore products) has slightly dropped.
Many of our key sectors which makes money are facing huge disruptions in the second quarter.
With the reopening of international borders expected to be delayed for a bit, Singapore’s tourism-related sectors like hotels, airlines, events and more will be affected.
Because the government is taking a long time in clearing foreign workers, it has also resulted in a delay of recovery for the construction and Marine & Offshore engineering sectors.
Don’t worry, all workers are tested and most have already been cleared.
But Not All Hope is Gone
There was a stronger-than-expected demand for semiconductors and semiconductor equipment in the second quarter of 2020 and MTI is expecting to see it continue for the rest of the year.
It was added that the biomedical manufacturing cluster, finance & insurance, as well as the information & communication sectors are all set to grow this year.
So if you’re unemployed and you don’t know what to do, you might want to take a look at these sectors.
Yes, even if you’re a mid-careerist because they’ve just opened traineeships to people who are in the middle of their careers.
Highly Dependent On Global Situation
Since before, even when Sang Nila Utama really saw a lion and fish mutant, Singapore has been dependent on the state of the world.
We used to make our fortune as a port of call for traders travelling to other parts of the world, after all.
Now, we’re equally dependent and as long as the US and other countries do not stamp out Covid-19, we’re looking at suffering economically together with them since the demand from these countries will drop.
So let’s hope that the WHO really get their funding and ramp up their ACT accelerator, eh?
Meanwhile, if you’re unemployed, you might want to check out the SG United Jobs and Skills Package where you can get new jobs or learn new skills to make yourself employable.
Again, if you don’t know what you want to do, it might be good to take a look at sectors which MTI predicts are looking at a possible growth this year.
And if you’re in need for some temporary relief (financially), you might want to check out this grant here.