Chart of the Day: More job cuts on the cards as manufacturing demand vanishes

Employment weakness will pose downside risks to inflation.

Singapore's labour market outlook will remain weak and is feared to deteriorate further in the second half, according to a report by HSBC.

HSBC said that manufacturing employment will continue to contract due to weak demand. Overall employment growth has also slowed significantly due to the sharp moderation in services employment growth.

The continued weakness in employment growth poses downside risks to the city-state's inflation, which is already stuck in its longest stretch of negative growth on record.

“The idea that tight labour markets would fuel wage gains for the broader populace is less convincing than
before – even the Monetary Authority of Singapore (MAS) has dropped all references to tight labour markets,” said HSBC.