MOM to Study How AI's Role in Retrenchments Can Be Better Tracked
Source: Human Resources Director
Singapore's labour market is running a strange race: employment keeps growing, yet retrenchments just hit their highest level in more than five years — and the government admits it cannot yet tell you how much of that is AI. In a written reply to Parliament on Aug 4, the Ministry of Manpower said...
Singapore's labour market is running a strange race: employment keeps growing, yet retrenchments just hit their highest level in more than five years — and the government admits it cannot yet tell you how much of that is AI. In a written reply to Parliament on Aug 4, the Ministry of Manpower said it is studying how to "better capture" the impact of artificial intelligence and automation in its retrenchment statistics, acknowledging that the current numbers lump everything under the broad category of business restructuring.
The reply, delivered to a question from MP Sanjeev Kumar Tiwari, is candid about the measurement problem: "It is currently difficult to isolate the impact of AI or automation as a primary driver of retrenchments as automation is typically implemented as part of broader business transformation or restructuring exercises." MOM added that it will continue studying how to improve the statistics — a signal that AI-related job displacement is now squarely on the policy radar, even if the data can't yet pin it down.
The timing matters. The latest Labour Market report shows 4,500 workers were retrenched in the second quarter of 2026, an incidence of 1.9 per 1,000 employees and the highest in over five years. The increases were concentrated in outward-oriented sectors like Information & Communications and Manufacturing, with most cuts attributed to business reorganisation. Meanwhile, high-profile AI-driven restructures are making headlines — Standard Chartered is cutting roughly 7,800 back-office roles by 2030, and NTUC has flagged offshoring and AI as key factors behind rising job losses among professionals, managers and executives.
There is also a counter-current MOM is careful to point out: an inaugural survey found only 6.2 per cent of firms reduced headcount after adopting AI, with most instead redesigning roles or creating new AI-related positions. The ministry maintains there is "no indication of widespread job displacement." The push for finer-grained statistics is about more than record-keeping — better data on which occupational groups are hit, and how quickly displaced workers re-enter employment, would let the government aim its retraining and redeployment support where it's actually needed.
Why it matters for Singapore: How the city-state measures AI's effect on jobs will shape its next round of workforce policy. If the numbers start separating AI-driven cuts from ordinary restructuring, expect more targeted support for PMEs in tech-exposed sectors, and a clearer public debate about how fast automation is really reshaping the economy — rather than anecdotes and headlines.
