Firms step up hiring yet bleak outlook remains

Companies in Singapore are still hiring workers “on the back of healthy demand”, according to a new survey

Firms step up hiring yet bleak outlook remains
Despite a bleak outlook and a weak job market, a survey conducted by the Nikkei Singapore Purchasing Managers’ Index (PMI) found that “companies stepped up hiring and increased output to meet stronger demand”.

The survey was conducted to measure production, hiring, and general sentiment in the corporate sector using a baseline reading. Anything above 50 means there has been an expansion while a reading below 50 suggests a contraction.

The headline reading for November was reported at 52.8, a nearly three-point increase from the headline reading from October (50.5).

Using data from more than 400 companies compiled by data analytics firm IHS Markit, PMI’s survey backs up a similar poll conducted by the Singapore Institute of Purchasing & Materials Management that showed a manufacturing PMI for November at 50.2.

“Though only moderate overall, the rate of job creation was the fastest since June 2014. A number of survey respondents that expanded their workforce numbers attributed the rise to increased employment of part-time staff," said IHS Markit in a statement.

However, it’s not all good news.

Bernard Aw, IHS Markit economist told The Straits Times that a number of firms cited an increase in part-time employment and this “casts doubt over the strength of the business outlook in the coming months”.

Other factors that contribute to a mixed outlook include:

•    A contraction of 2% in the third quarter of the country’s trade-reliant economy citing a slowing global economy;
•    A narrowed growth forecast of the Ministry of Trade and Industry from 2% to 1.5% while next year’s expansion is tipped at 1 to 3%;
•    A weak job market that showed unemployment rising from 2.8 to 3%, according to the Ministry of Manpower’s latest results. 

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