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Retrenchment risk high in the manufacturing sector

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The manufacturing industry accounted for two-thirds of the 2,212 workers retrenched in Singapore’s unionised sector in 2014, led by the electronics sector .

The layoffs were a result of cost pressures and business restructuring, which also led to eight companies relocating away from Singapore to countries like Thailand, Malaysia and China.

It is estimated that in the first quarter of 2015, 300 workers from unionised companies in the electronics and chemical sectors may face retrenchment.

According to the industry outlook released by the National Trades Union Congress (NTUC), the service sector also saw a large number of retrenchments in 2014. Due to the loss of local business, layoffs were pegged at 722, twice that in 2013.

NTUC also noted that nationwide, there was an increase in the number of workers retrenched in the first three quarters of 2014 (7,710) from the same period a year ago (7,220). The unionised sector accounted for about one-fifth of this number.

However, owing to manpower challenges, workers are in high demand in sectors such as bus transport, hotels, healthcare and security.

ALSO READ: Employment rate for Singapore’s polytechnic grads takes slight dip

The report notes that unionised companies doled out healthy wage increases in 2014, at about 4.1%, due to collective bargaining and adoption of the National Wages Council guidelines.

They are also estimated to pay an average of 3 months’ bonus in 2014, inclusive of the 13th month bonus. While healthcare, education and electronic sectors remained stable, companies in hotels and hospitality, construction and chemical sectors generally saw lower bonuses.

The trend of negative productivity growth in recent quarters is a concern, as cited in the report.

“This could lead to wage stagnation. To ensure that our workers can continue to receive wage increases, the Labour Movement stressed that productivity must improve, and more needs to be done in this area,” it said.

Other trends noted in 2014, include better benefits, with more companies offering family-friendly leave, such as compassionate leave for death of immediate family members (98%) and paternity leave (78%).

Image: Shutterstock

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