Labour market resilience is expected to continue into 1H25, but hiring in trade-related sectors may slow due to uncertainties around US tariff policies, UOB said.

In a commentary note, the bank highlighted that sectors such as wholesale trade, transportation, storage, and manufacturing could face hiring challenges due to these uncertainties.

However, UOB noted that declining global policy rates might offset these pressures by supporting investment and consumption and positively impact Singapore's labour market.

On the other hand, the 3Q24 Labour Market Pressure Index (LMPI) reflects significant easing in labour market tightness since 2Q22, with conditions stabilizing in 3Q24.

The job vacancies-to-unemployed ratio declined to 1.39 in 3Q24 from a peak of 2.54 in 2Q22 but remains above 1.0, indicating that job opportunities still exceed the number of job seekers.

UOB said the LMPI shows a positive correlation with the Monetary Authority of Singapore's (MAS) core and services CPI, which suggests a tighter labour market contributes to upward pressure on consumer prices.