Up 17%: Retrenchments rise to highest level since Q4 2020

Retrenchments in Singapore rose by 17.5 per cent in the second quarter of 2026, the highest level since the fourth quarter of 2020, according to advance labour market data from the Ministry of Manpower (MOM).

In a report on Friday (July 31), the ministry said that retrenchments rose to 4,500 in the last quarter, but remain "well below levels typically seen during periods of downturn".

There were 3,500 layoffs within the services sector, 800 in manufacturing and 200 in construction.

According to MOM, the layoffs were concentrated in some outward-oriented sectors — including information and communications and manufacturing — and were driven primarily by business restructuring.

Despite the increased layoffs, total employment expanded for the 19th consecutive quarter.

Total employment grew by 10,700 in the second quarter of 2026, though at a slower rate than the previous quarter.

Data also showed that resident employment growth was concentrated in essential and public services while non-resident employment growth was mainly in construction and manufacturing.

At the same time, MOM noted that unemployment rates remained "low and stable" in the second quarter at 2 per cent — same as the previous quarter.

More firms expect to hire in Q3

Looking ahead, MOM data showed that firms are more upbeat on hiring expectations going into the next quarter.

The proportion of firms expecting to hire over the next three months rose to 43.9 per cent in June 2026, up from 40.6 per cent in May 2026.

The share of firms expecting to raise wages also increased to 29.3 per cent from 23.7 per cent over the same period. 

Fewer firms also expect to layoff employees in the next quarter, declining from 3.2 per cent in May to 2.7 per cent in June. 

"The improvement in hiring, wage, and retrenchment expectations suggests that labour demand is resilient," the ministry said.

But it noted that the improved hiring and wage sentiments remain below pre-crisis levels in February.

"This suggests that firms will likely continue to adopt some caution with their hiring and wage decisions in the near term," MOM added.

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