Morgan Stanley, 22 May 2009, Deyi Tan & Chetan Ahya
In this global recession, the labour market in Singapore seems to be showing a contrary trend. To be sure, the labour market is a lagging indicator. Employment growth in Singapore lags GDP growth by around two quarters. On the way up, corporates are usually slow to add to headcount, preferring to increase overtime hours for existing workers until the macro recovery firms. On the way down, human resource management simply cannot be as precise as just-in-time inventory management. The demand shock tends to be absorbed first by the profit cushion before the wage cost containment exercise starts.
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