Employers face persistent skill shortages

Hiring slowdown masks tight labour market.

Singapore’s labour market remains tight despite a slowdown in hiring, as persistent skill shortages and cautious job switching continue to constrain talent supply across key sectors.

Hiring activity fell 17.9% year-on-year in October, but job demand remains elevated. Callam Pickering, Senior APAC Economist at Indeed said job postings are still well above pre-pandemic levels despite easing in recent years. “Even after easing for the past three years, job postings in early 2026 were still 38% above pre-pandemic levels,” he said, noting that the pattern applies to around 90% of occupations tracked by the platform.

The decline in hiring reflects a normalisation after the pandemic-era recruitment surge rather than economic weakness. “The post pandemic job boom was always unsustainable,” Pickering said, adding that demand remains strong enough to keep Singapore’s unemployment rate around 2%.

At the same time, employers are becoming more cautious amid global uncertainty. Adrian Choo,  CEO/Founder Career Agility International said businesses are holding back on hiring decisions due to multiple external pressures. “We have a trifecta of unknown forces that are coming together and causing a lot of uncertainty in the market,” he said, citing geopolitical tensions, tariffs and rapid developments in artificial intelligence.

Despite slower hiring, companies continue to struggle to fill roles. Kirsty Poltock, Country Manager of Robert Walters Singapore said many employers report difficulty finding candidates with the right skills and experience. “The top challenges that employers cite for sourcing staff include a lack of quality candidates with the right kind of skills and experience, also a mismatch of salary and benefit expectations.”

Worker mobility has also fallen, further tightening the labour market. Poltock said employees are increasingly staying in their current roles due to economic uncertainty. “We're also seeing significant professionals adopt a job hugging kind of approach,” she said, adding that counteroffers from employers are also keeping workers from leaving.

Structural demand in key industries is adding to the pressure. Pickering said demographic changes are increasing demand for healthcare workers. “The healthcare industry is a prime example. So an aging population has created tremendous demand for doctors and nurses and aged care workers,” he said.

Technology-related skills are also in short supply. Poltock said demand for AI, data and cloud expertise continues to exceed available talent.

To compete for scarce talent, employers are adjusting their hiring strategies. Poltock said companies are offering higher salaries and career development opportunities whilst also adopting more flexible workforce models.

Pickering added, “Placing emphasis on things that job seekers value, such as flexibility, work from home initiatives, you know, other benefits, is a great way to stand out when candidates have options.”