Alarming jump in Singapore’s youth unemployment rate – to worry or not?

By September 26, 2017Current

TL;DR – It depends on what gigs youths are getting into.

Official labour statistics show that there is an alarming jump in the under-30 resident unemployment rate (to 7.8 per cent in the second quarter of this year) and the falling male labour participation for the 20 to 24 age group, a 10-year low.

That sounds like something that we should be quite concerned about.

High youth unemployment will increase the income gap, and result in greater tension between the haves and the have-nots.

More youths getting into the gig economy

However, the picture may not be that bad.

According to a report released on Friday (Sept 22) by Maybank Kim Eng, a growing proportion of Singapore’s workforce, especially millennials, is engaged in the “gig economy”.

Statistics from the Ministry of Manpower (MOM) suggest there are 167,000 gig workers here or about 8-10 per cent of Singapore’s labour force. Labour MP Ang Hin Kee from NTUC believes the number of freelancers to be higher, closer to 200,000.

Even that could be an underestimation. For instance, there are as many as 50,600 applicants for the private-car hire vocational licence versus the Government’s earlier estimates of about 10,500 private-car drivers.

Also, more graduates or millennials are joining the gig economy. According to official data, the proportion of millennials joining the gig economy is more than double from a decade ago.

So it may not be that bad, right? We don’t really have that many young people out of work. They actually have jobs. Just not in the traditional form.

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Phew! We can breath easy now. 

Not really. It really depends on what sort of gigs those youths are actually getting into.

May not be a good thing…

For instance, if we have significant numbers of youths, fresh out of school, working full-time as an Uber driver, and aren’t finding opportunities while working as Uber drivers to upgrade and pick up some other skills, then that might be a problem.

Why? Because there really isn’t much in the way of career progression for Uber drivers.

Worse, with advances in technology, where we might have autonomous vehicles plying the streets soon, the career lifespan of Uber drivers might not be that long.

The gig economy also presents other challenges. For instance, it essentially shifts the risk and responsibilities – such as CPF contributions, insurance, and compensation in the event of an accident on the job – away from employers to workers. Workers become more vulnerable and have less protection. These present challenges for labour relations, healthcare and retirement adequacy.

Need to make the gig economy work for workers

A number of things have been done to make the gig economy work for workers. In 2015, the Labour Movement launched U FSE (Freelancers and Self-Employed) to represent the growing pool of freelancers and self-employed in Singapore.

Last year, U FSE organised the first Fair for Freelancers. The event  gathered business solution providers and service aggregators who could support freelancers in accounting and administrative paperwork, and to help them connect with clients online or to collaborate with each other on projects through digital platforms. The success with the first fair led to a second Fair for Freelancers this year.

Labour MP Ang Hin Kee stressed of the need to take a new approach towards looking after freelancers’ needs. He said, “We want to be able to be there for them, understand their issues and challenges.” (via)

Also, in May this year, the government has set up a tripartite workgroup to study the concerns faced by those in the gig economy. These include a loss of income from injuries sustained on the job or while attending training. They are also concerned about being ineligible for employee benefits, the lack of savings for retirement and housing, and not receiving full payment from customers in a timely manner.

Would these help youths joining the gig economy?

We don’t know. But for a start, perhaps what these gig workers and freelancers can do is to come together and have their voices heard.

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Jake Koh

Author Jake Koh

Recovering sushi addict, I'm a man of mystery and power, whose power is exceeded only by his mystery.

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