SINGAPORE'S unemployment will stay up for some time, even as the economy has decisively emerged from its worst recession and started to grow again.
Sounding a note of caution, Prime Minister Lee said in the short term, the jobless rate may well rise above the second quarter's 3.3 per cent.
'This is because unemployment numbers tend to lag behind the economic recovery. Companies will not resume large scale hiring until they are confident of sustained recovery,' he told the NTUC ordinary delegates conference on Tuesday morning.
PM Lee noted that the United States is bracing for its unemployment rate to rise above 10 per cent, and the growth in the US, Europe, Japan and China has so far been due to government spending.
'When the stimulus ends, their economies may slow down again. If that happens, our growth will be dampened too. Even with growth, our unemployment will stay up for some time,' he said. 'Therefore, we must be psychologically prepared for dampened growth, or in any event for unemployment to stay up.'
Singapore's unemployment rate is at the highest in four years and nearly 19,000 workers lost their jobs in the first half of the year as the global recession curbed demand for goods and services.
Tue Oct 13, 2009 12:44 pm