Tweaking the Statistics

I've been thinking about our Budget

"We start from a position of low unemployment, the lowest in Asia
last year. The resident unemployment rate was 3.3% in September. However,
given the severe economic recession, we have to expect many more jobs to
be at risk this year."--from Budget Speech 09

"IN what an expert called a “doomsday prediction”, two economists say Singapore may lose 300,000 jobs by next year, of which two-thirds would belong to foreigners."--Today, Wed, Jan 21, 09

"...an Employment Pass is tied to a specific employer. If the expat loses his job, the EP becomes invalid and the expat has to leave Singapore more or less immediately (7 days, to be precise). His family has to leave with him too."--Mr Wang

When you add all these excerpts together, looks like the government will still have something to show despite the financial crisis. At least, unemployment rate should not rise too high. In the first place, if, like what the analysts at Credit Suisse forecast, most jobs will be lost by foreigners, who, like what Mr Wang notes, "has t leave Singapore more or less immediately" once they lose their jobs, the unemployment rate should remain more or less constant. The Budget will further ensure this by subsidizing the wages of local employees, thus preventing loss of jobs by Singaporeans.

Not to run down the Budget or anything but if December's headline should read--"Unemployment rate remains low despite economic downturn.", AND the media once again spin it as another great accomplishment by our elite government, it is probably due to the change in statistics. Statistically, unemployment rate may get affected less, when retrenched personnel are immediately packaged out of the country. But one point to take note is that the low unemployment rate means Singaporean workers have been able to retain their jobs, which means that the Budget has worked, to the government's credit. It does not mean that we will have the same number of jobs then as we have now, and that from now until then, few people have lost their jobs.

Unemployment rate as an indicator of economy should thus be taken with a pinch of salt. Performance of the economy by looking at the GDP and net exports should be of more relevance when considering how Singapore as a whole has fared through the crisis.