SINGAPORE: Prime Minister Lee Hsien Loong believes Singapore's growth forecast for this year will have to be revised downwards.
Although the current estimate is between minus 2 and minus 5 per cent, Mr Lee does not expect the contraction to hit double digits.
One bright spot - unemployment numbers are better than he feared.
Visiting retrenched workers undergoing retraining on Thursday, Prime Minister Lee said it is still unclear whether the global recession will continue for the next few years.
Exports from Singapore were down one-third in January and hardly climbed in the last two months.
But there is a silver lining.
Mr Lee said: "We had expected a very big wave of retrenchment and unemployment, particularly after Chinese New Year this year. But so far I think the number of retrenchments and unemployment numbers had been better than we had feared. And I think the efforts which we put in must have had something to do with this."
The efforts include the Jobs Credit scheme and Skills Upgrading & Resilience Programme or SPUR - which helps retrenched workers retrain at places such as the Employment and Employability Institute (e2i) - to get new jobs.
For a four-week period starting end-January, retrenchment numbers averaged 800 to 900 workers a week in the unionised sector. But they are now down to about 200 to 300 weekly.
Mr Lim Swee Say, NTUC Secretary-General and Minister in the Prime Minister's Office, said: "We must be prepared that there could be a second wave of retrenchment coming on board. There is a big difference between retrenchment and unemployment. If we are not able to help the retrenched workers gain re-employment, then obviously every retrenched worker will add to the pool of unemployed workers."
The e2i will be ramping up efforts to retrain the retrenched for new jobs in the months ahead. Current experience shows that only about 20 per cent of the retrenched are assessed to be job-ready. The other 80 per cent either requires skill conversion or a lot more basic training.
Over 10,000 people lost their jobs in the first quarter of this year. But there are still job vacancies available in the market.
At e2i, for example, employers are looking to fill over 18,000 jobs in various sectors. And workers who undergo training have a much better chance of securing those jobs.
More than 4,000 people found new jobs after taking up retraining courses in the first quarter of this year.