EDITORIAL: The Straits Times says: Tough, uneven road ahead for workers

Singapore’s second-quarter gross domestic product (GDP) growth numbers were expected to be dismal, given that the three months covered most of the circuit breaker period from April 7 to June 1, when non-essential services were suspended and most workplaces closed. But the reality turned out to be even worse than expected, with the economy shrinking a record 12.6 per cent year on year, compared with a consensus forecast by economists of minus 10.5 per cent. The quarter-on-quarter contraction was an eye-popping 41.2 per cent – another record – which confirmed that for the first time since the global financial crisis of 2009, the economy has slid into recession, defined as two consecutive quarters of negative growth.

The lifting of the circuit breaker from June onwards kindles hopes of some recovery in the second half of this year, but it is likely to be slow and uneven. In particular, industries that depend on open borders, including aviation, tourism and hospitality, will remain in dire straits, while others such as retail, food and beverage, and entertainment will continue to be weak because of social distancing measures and consumer caution. The construction sector, which suffered a bruising decline of 54.7 per cent year on year in the second quarter, will likely continue to be constrained by a shortage of foreign workers, many of whom remain confined to their dormitories.