At the same time, Singapore also saw a decrease in job vacancies
Singapore’s job market weakened in Q1 2026 as vacancies fell and layoffs hit their highest level since Q3 2023.
Layoffs increased to 3,830 in Q1 2026, from 3,690 in Q4 2025, according to the Ministry of Manpower (MOM) which has completed its Labor Market Report for Q1 2026.
At the same time, job vacancies fell from 77,700 in December 2025 to 73,300 in March 2026, down from 80,100 a year earlier.
Senior management and senior staff are particularly affected by the layoffs
For educational qualifications, the most notable change was among graduates, whose layoff incidence rose sharply from 2.6 in Q4 2025 to 3.1 per 1,000 resident workers in Q1 2026—the highest of all qualification groups.
MAMA said this shows the ongoing restructuring in the fields of expertise and knowledge.
In contrast, the incidence of layoffs was 0.7 per 1,000 resident workers for those with a high school degree or less, and 1.1 per 1,000 resident workers for those with diplomas and professional degrees.
Among all age groups, older workers aged 50 to 59 were the most affected by layoffs, up from 2.8 in the previous quarter to 3.1 per 1,000 workers in March.
Demand remains strong for exceptional talent
Meanwhile, MAMA said the overall decrease in job vacancies was largely due to fewer openings in non-professional roles.
Demand for skilled workers remained strong, leading to an increase in vacancies for professionals, managers, supervisors and technicians (PMETs).
Financial services was one of the sectors that saw strong growth in hiring for PMET roles, with vacancies rising from 4,300 last quarter to 5,800 by March 2026.
Statistics suggest that although employers are more aware of expanding their workforce, demand remains strong for specialized skills and advanced skills.
Slow growth of activity
Despite the increase in layoffs from Jan to Mar 2026, the labor market continues to expand—just at a slower pace than the previous quarter.
Total employment grew by 9,400 in Q1 2026, slower than the 17,700 increase in Q4 2025.
“I know many Singaporeans are worried about the economy, global uncertainty and what AI means for their jobs,” said Labor Minister Tan See Leng.
“This is a real concern. We understand the challenges many workers and many new graduates have faced, but I want to reassure everyone that despite this uncertainty, there are encouraging signs in the labor market.”
He noted that resident employment growth accelerated from 3,100 in Q4 2025 to 5,400 in Q1 2026.
Benefits were concentrated in administrative and support programs—employment jobs, travel-related services, and roles such as customer service, administrative clerks, and travel agency clerks. Resident employment also increased in transportation and maintenance, as well as public administration.
Although financial institutions are hiring more people, resident employment in financial services and insurance declined, driven by a decline in self-employment. “Firms may prioritize small but sustainable value, while workers strive for stability amid uncertainty,” MOM said.
Overall, MOM emphasized that the increase in layoffs was largely due to restructuring or restructuring, rather than cost-cutting. Layoffs are concentrated in export-oriented sectors such as manufacturing, financial services, and professional services.
The rate of laid-off residents returning to work within 6 months has increased
MAMA also added that labor market results remain strong. The rate of residents returning to work within six months of layoffs increased to 60.7%, up from 57.4% in the previous quarter.
“Improvements have been seen in PMETs, graduates and young citizens under the age of 30, suggesting that laid-off workers continue to find work in a timely manner,” the Department said.
More employers are turning to shorter work weeks or short-term layoffs to avoid layoffs—1,230 workers were on this arrangement in Q1 2026, up from 960 in Q4 2025. The increase was sharpest in construction and manufacturing, and among production and transportation operators, cleaners, and laborers.
These temporary measures are often indicative of a recession, but MOM said it is better than layoffs, as they maintain employee benefits and show the company’s commitment.
The department said, “as layoff rates remain low and job vacancies tight,” the increase reflects an increase in companies’ reduced work hours to accommodate temporary changes in labor needs rather than layoffs.
In addition, MAMA said unemployment rates in Mar remain low and stable—at 2% overall, 2.9% for residents and 3.1% for residents. The unemployment rate for long-term residents held steady at 0.9%.
The impact of AI on Singapore’s labor market
For the first time, MAMA’s quarterly labor market report addressed the impact of AI on the workforce, combining data first released in a detailed report in April.
“Of course AI will change the way we work, but what we see so far is that it really helps to reshape jobs rather than replace them,” said Dr. Tan.
April data showed that among firms using or exploring AI, 6.2 percent reported more headcount reductions and 8.5 percent reported lower hiring.
After adopting AI, it was common for firms to restructure operations, with 18.9% of respondents doing so.
Dr. Tan also highlighted the positive employee experience, with nearly 85% of AI users reporting benefits to productivity, time savings, and quality of work.
“That’s why helping employees learn new skills and adapt to changing job demands is so important as more and more companies adopt AI,” he said.
So far, only 28.5% of Singapore companies have used the technology.
Adoption rates vary by sector, with the highest performance in digital, knowledge-based industries such as information and communications, professional services, and financial and insurance services.
He said the government would continue to provide funding, pointing to about 400 people who have gone through Workforce Singapore’s 2025 job transformation programs—training for redesigned roles, including those with AI components.
Historically low clearance rates
The department also flagged the low clearance rates, which it linked to staff caution amid global uncertainty.
The average monthly write-off rate of 1% in Q1 2026 is a historic low, while the financial and insurance sector recorded its lowest write-off rate of 0.6%.
Even the most profitable sectors saw workers lay off. Quitting rates for food and beverage services fell to 1.8%, retail trade to 1.4%—both multi-year lows.
The average monthly employment rate of 1.6% is also among the lowest in years, MAMA said.
The department expects the labor market to remain strong, although companies may be more cautious about hiring and raising wages amid global economic uncertainty and political tensions.
“Labor demand is likely to moderate if external conditions weaken and high global input costs persist,” it added.
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