Singapore’s Labour Market in 3Q 2025: Growth Is Back, but Hiring Sentiment Remains Cautious

This article is written in English for readers in Singapore. Chinese and Japanese translations are available on our website. 

A Stronger Labour Market, but a More Cautious 2026 Ahead

Singapore’s Labour Market Report for 3Q 2025, released by the Ministry of Manpower on 11 December 2025, paints a picture of recovery, resilience and recalibration.

After a muted first half of 2025 influenced by global uncertainty, the third quarter delivered:

• Stronger employment growth (+25,100)
• Low unemployment (overall 2.0%)
• Firm demand for PMEs despite easing vacancies
• Low retrenchments with more employers opting for short work-week arrangements

Yet, the data also signals a cooler hiring outlook heading into 2026 as businesses stay cautious with wages, headcount, and expansion plans.

This duality — growth today, caution tomorrow — is shaping what companies and professionals must prepare for in the months ahead.

1. Employment Growth Accelerates: +25,100 Jobs Added in 3Q 2025

Total employment expanded by 25,100, more than double the 10,400 increase in 2Q 2025.

Where the jobs were created

• Residents:
  Growth was led by:
  — Financial & Insurance Services
  — Health & Social Services
   
• Non-residents:
  Largest gains were in:
  — Construction
  — Manufacturing

These patterns reflect Singapore’s ongoing sectoral shifts — strengthening its financial and healthcare systems, while accelerating major construction and industrial projects to support long-term economic competitiveness.

2. Unemployment Stayed Low Across the Board

Singapore’s unemployment landscape remained stable in September 2025:

• Overall: 2.0%
• Residents: 2.8%
• Citizens: 3.1%
• Long-term resident unemployment: 0.9%

These are healthy levels by global standards, reinforcing that Singapore’s labour market is tight but stable.

At the same time, fewer jobseekers combined with stable PME demand resulted in an improved job vacancy–to–unemployed ratio of 1.49, up from 1.35 in June 2025. This means there are still more vacancies than jobseekers — especially for PMEs — a pattern consistent with Singapore’s skills-driven economy.

Singapore Labour Market Indicators — 2Q vs 3Q 2025

Indicator	2Q 2025	3Q 2025	Notes
Total Employment Growth	+10,400	+25,100	Growth more than doubled
Overall Unemployment	2.0%	2.0%	Stable
Resident Unemployment	2.8%	2.8%	Stable
Citizen Unemployment	3.1%	3.1%	Stable
Job Vacancies	76,900	69,200	Slight easing
Vacancy-to-Unemployed Ratio	1.35	1.49	More vacancies per jobseeker
Retrenchments	3,800 (approx.)	3,670	Low levels
Short Work-Week / Temporary Layoff	620	800	More employers retaining staff

Source: Ministry of Manpower, Labour Market Report 3Q 2025

3. Job Vacancies Eased to 69,200, but PME Demand Stayed Firm

Job vacancies fell slightly from 76,900 (June 2025) to 69,200 (September 2025).

Despite this decline, the report notes that PME vacancies remain firm, signalling ongoing demand for specialists in:

• Technology
• Engineering
• Finance
• Healthcare
• Corporate and operational leadership roles

For companies, this means skills shortages will continue in key knowledge-based areas.

For workers, the message is clear — upskilling remains your strongest currency heading into 2026.

4. Retrenchments Remained Low, and Companies Avoided Letting Go of Staff

Retrenchments held steady at 3,670, or 1.6 retrenched workers per 1,000 employees.

Instead of letting staff go, employers increasingly turned to:

• Short work-week arrangements
• Temporary layoffs

A total of 800 workers were placed on such arrangements in 3Q 2025 compared to 620 in the previous quarter. This signals employers’ desire to keep talent close — avoiding the high cost of rehiring when the market stabilises again.

However, re-entry rates dipped slightly, with 55.4% of retrenched residents returning to employment within six months (down from 56.3% in 2Q 2025).

5. Singapore’s Updated GDP Forecast: 2025 Upgraded to 4.0%

One of the biggest macroeconomic updates came from MTI.

Singapore upgraded its 2025 GDP forecast from “1.5% to 2.5%” to “around 4.0%” after stronger-than-expected performance in 3Q 2025.

But headwinds remain.

Outward-oriented sectors — such as manufacturing, logistics and tech — still face external risks. Firms are now:

• More cautious about hiring
• Less likely to raise wages
• More likely to consider redundancies (rising from 1.9% to 2.3%)

This means businesses must balance cost discipline, talent retention, and capability building going into 2026.

6. What Companies Should Do Now

a) Invest in workforce transformation

Government support is strong for companies that commit to long-term capability-building:

• Career Conversion Programmes (CCPs)
• Productivity Solutions Grant – Job Redesign (PSG-JR)
• SkillsFuture Enterprise Credit ($10,000 top-up in 2026)

These programmes reduce hiring pressure by upskilling your existing staff, strengthening retention and business continuity.

b) Build a stronger employer brand

With PME talent remaining in high demand, companies that articulate their value proposition clearly — purpose, progression, flexibility — will secure stronger hiring outcomes.

c) Review wage benchmarks carefully

Hiring sentiment is cooling, but skills shortages persist.

Companies must benchmark salaries accurately to stay competitive without overshooting budgets.

7. What Workers Should Do Now

a) Futureproof your skills

Tap into programmes such as:

• SkillsFuture Level-Up Programme
• Career Health SG
• WSG career coaching
• CareersFinder on MyCareersFuture

Workers who continually update their portfolio with AI literacy, digital skills, sustainability knowledge and cross-functional capabilities will remain competitive.

b) Strengthen employability

Workers facing job transitions can benefit from:

• SkillsFuture Jobseeker Support (up to $6,000 over six months)
• Career health assessments
• Structured reskilling pathways

c) Fresh graduates should leverage GRIT

The Graduate Industry Traineeship (GRIT) scheme expands entry opportunities into competitive fields.

8. What This Means for Singapore in 2026

Overall, the 3Q 2025 report reflects a resilient but evolving labour market.

The positives:

• Employment growth more than doubled
• Unemployment stayed low
• PME demand remains firm
• Employers are retaining talent during uncertainty

The challenges:

• Job vacancies are easing
• More cautious hiring and wage expectations
• External risks remain
• Higher percentage of firms planning redundancies

Singapore enters 2026 with momentum, but also moderation, requiring companies and workers to remain adaptable, data-driven, and skills-oriented.

 

FAQ: Singapore Labour Market 3Q 2025

1. Is the labour market improving in Singapore?

Yes. Employment grew faster in 3Q 2025, unemployment remained low, and PME demand stayed firm.

2. Are companies still hiring?

Yes, but many are becoming more cautious in hiring and wage increments due to global uncertainty.

3. Which sectors saw the strongest growth?

Financial & Insurance Services, Health & Social Services, Construction and Manufacturing.

4. How will the report affect workers?

Workers with strong technical or cross-functional skills will remain in demand. Upskilling is critical.

5. Should companies worry about retrenchments?

Retrenchments remain low, but more firms are considering redundancy plans for 2026. Talent planning is essential.

 

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✅ Final Author Credit
By Valerie Ong (Regional Marketing Manager)
Published by Reeracoen Singapore — a leading recruitment agency in APAC.

 

🔗 Related Articles 

• Navigating Economic and Tech Signals in 2025: What Singapore’s Job Market in AI, Data, and Finance Reveals
• Upskilling in the Age of AI & Green Jobs
• Beyond Salary: Unique Employee Benefits in Singapore That Attract and Retain Talent

📚 References

• Ministry of Manpower, Labour Market Report 3Q 2025
• https://www.mom.gov.sg/newsroom/press-releases/2025/1211-labour-market-report-3q-2025

 

 

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