[SINGAPORE] It is the year 2017, and the tech sector is booming. With Industry 4.0 in full swing and FAANG stocks on the rise, pursuing data science and analytics seemed a safe bet for career security.
That was the logic for Koh Long Yang, a self-described math lover who was deciding what to study before entering national service. His reasoning was simple: every company needs data, and someone to make sense of it.
Fast forward to 2024 with graduation in sight, and the reality of his job prospects began to sink in.
He tells The Business Times he started sending out resumes in February 2024 – about five months before graduating from the National University of Singapore – and stopped counting when he hit 95. In total, he estimates having sent out about 150 applications.
“At that point, you’re living in times of uncertainty because every morning you wake up, you just check your e-mail – is there anything? Nothing. Then you go back to LinkedIn, JobsDB, every job website that you can find; you just go and try,” he says.
Still jobless months after graduation and increasingly desperate, he leapt at the opportunity to intern at a startup through a contact he met through reservist duty.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Koh’s frustrating experience with landing a full-time job seems increasingly common among recent graduates who shared their stories with BT.
Also from the class of 2024, communications graduate Timotheus Yeo from Nanyang Technological University has a similar tale. Despite a portfolio that included internships and freelance work, he found himself pivoting from film production to marketing in search of better job prospects.
He sent out over a hundred applications, enrolled in online courses to upskill, and still heard little back.
“I did not expect the market to be so bad,” he tells BT. “I came in thinking: ‘Oh, if I just apply to a few jobs, I definitely will get replies, I definitely will get interviews.’”
He adds that others’ experiences shared on online forums and TikTok show he is not alone.
“I see people actually apply way more than me, like 300, and people in the comments are saying: ‘Oh, I applied to like 50 jobs a day, and I still get no reply.’ That is actually so insane,” Yeo says.
It was disheartening, he says, despite his career coach’s reassurance that even a 10 per cent interview rate was “very good”.
It was a chance meeting with a college senior that gave him an opening into travel platform Klook, where he has just started work in social media marketing.
With such stories becoming prevalent, there’s little doubt that it is a tough time to be a fresh graduate.
From shifting employer preferences and artificial intelligence (AI) disruption to a possible mismatch between university training and industry needs, the ground beneath graduate employment is shifting.
But even as young jobseekers brace for a longer, bumpier road ahead, there are wider implications for Singapore that will need to be addressed.
Cyclical or new trend
Data from this year’s joint graduate employment survey for the 2024 cohort corresponds with what young jobseekers are saying. The proportion that remained unemployed six months after graduation grew to 12.9 per cent, up from 10.4 per cent in 2023.
This marks the third straight year of increase. In particular, only 79.5 per cent of the 2024 cohort found full-time permanent jobs – a 4.6-percentage-point drop from 2023 levels and the lowest rate in seven years.
The numbers are even more stark for graduates from private universities: The unemployment rate jumped 8.4 percentage points year on year to 25.2 per cent, and fewer than half of the cohort found full-time permanent jobs.
In March, then minister of state for education Gan Siow Huang told Parliament that employment rates of fresh graduates from Singapore’s autonomous universities have remained “broadly stable over the decade, with some year-to-year fluctuations due to cyclical changes”.
She noted that there was lower hiring demand and fewer vacancies last year, even if the labour market remained tight after the post-Covid recovery.
Labour market watchers are mixed over whether the falling numbers indicate the start of a worrying trend of higher unemployment among graduates.
Some observers say the numbers are not too far off pre-Covid levels and could be part of a “cyclical fluctuation”, even as they point out underlying reasons for the recent spike.
“Graduate unemployment had declined for many disciplines over 2020 to 2022, owing to a spike in hiring for certain sectors like tech and also possibly due to favourable government policies like the Jobs Support Scheme and SGUnited Jobs and Skills,” says Maybank economist Brian Lee.
“When looked at from a five-year horizon, it is not yet clear that we are in a graduate unemployment uptrend.”
Walter Theseira, an economist from the Singapore University of Social Sciences, says recent numbers reflect a trend towards “non-traditional employment” – namely, gig work, contract roles and short-term work replacing the traditional 9-to-5. This trend started with polytechnic and Institute of Technical Education graduates, and is now increasingly common among university graduates.
He based this observation on overall employment rates remaining more stable, even as full-time permanent employment rates have been trending down.
“This is likely partly driven by employers preferring more flexibility in contracting employment, the shift towards technology and business process-driven outsourcing, as well as preferences from graduates themselves for more flexible forms of work,” says Assoc Prof Theseira.
Tech moves rapidly despite the slow economy
While the uncertain economy could be a factor, the apparent slowing demand for fresh graduate talent may not be as straightforward as it seems.
“A tougher business environment could have led employers to become more selective with hiring, with a preference for more experienced hires over fresh graduates,” says Maybank’s Lee. “Some companies could be increasingly relying on non-permanent staff, such as contract hires.”
Yet, some graduates may be holding out for roles that match their salary expectations or for permanent employment, which can make their job search longer in a competitive market, says David Blasco, country director at recruiter Randstad Singapore.
Eugene Tan, associate economist at Moody’s Analytics, notes there are other structural reasons as well.
While job vacancies for professionals, managers, executives and technicians have fallen, the latest figure, he notes, sits at about 40 per cent above 2019 levels.
“This indicates that the challenge facing graduates may stem more from a mismatch of skills than an oversupply of university graduates,” he says.
The skills mismatch is further widened by rapid technological advancements, says Blasco, making the job-seeking market seem much more competitive than before.
“Many employers now have higher hiring expectations, and candidates are expected to hit the ground running without needing extensive training and onboarding,” he says.
To be sure, the woes faced by fresh graduates are not unique to Singapore but a global phenomenon.
A May report by California-based venture capital firm SignalFire notes that new graduates account for just 7 per cent of hires at Big Tech companies.
New hires in 2024 fell 25 per cent compared with 2023 and over 50 per cent from 2019 levels.
Lewis Garrad, Asia career leader at HR consulting firm Mercer, draws a parallel with the US, where unemployment among recent graduates has also risen.
“What we can see in the US is that graduates in areas such as technology, finance, and professional services are having the most difficulty finding employment. These are areas that hired aggressively during the post-Covid period and are likely to be adjusting to a new economic trajectory,” he says.
At the same time, these industries are also where AI is being adopted most quickly, he points out, with senior management “encouraging the use of AI by reducing other available resources”.
The paradox of tech demand
As more companies digitalise and adopt AI, the demand for tech talent remains unsatiated, despite high-profile layoffs.
Yet, this does not necessarily translate into more jobs for tech graduates, as Koh found out the hard way.
Blasco says the paradox exists because technological developments have outpaced the supply of graduates with “the right mix of practical, industry-ready skills”.
“Employers report difficulty finding candidates with relevant hands-on experience, even as talent and roles in AI and data science soar in demand,” he says.
In May, top LinkedIn executive Aneesh Raman warned in The New York Times that “the bottom rung of the career ladder” will be the first to be broken by AI-led disruptions, as advanced tools take over simple tasks once assigned to new hires.
In Singapore, AI may not have had a “pronounced impact on employment as yet”, as companies are still adapting to AI, says Terence Ho, deputy executive director at the Institute for Adult Learning (IAL) Singapore.
Citing Mercer’s research, Garrad says only 29 per cent of Singapore organisations are regularly using generative AI, and only 5 per cent say AI has “led to a fundamental shift in their business model”.
Even so, watchers agree it may be a matter of time.
Assoc Prof Ho from IAL says “it is recognised that AI can replace a large number of entry-level job tasks”, including market research, coding and compilation of reports.
More generally, if and when AI displaces entry-level jobs, the question remains: how can new hires learn the ropes to progress to more senior positions?
“This is the question that all organisations with professional and knowledge workforces are trying to answer,” says Garrad.
“Some will simply keep a smaller entry-level layer with a specific focus on growing talent with less attrition”, (while others) will look to invent entirely new types of jobs that utilise AI to maintain this talent pool,” he says. “However, these new types of jobs remain unknown.”
But perhaps the bigger question is whether the use of AI affects the way people learn in the first place.
Assoc Prof Theseira notes that it is common today for students to use AI to answer assignments – something that is impossible to ban.
“It is unclear from our viewpoint as educators that students learn the same way when they get help from AI, as when they used traditional self-directed study and writing,” he says.
“Will a year of experience on the job with AI tools lead to more skill development or less skill development than a ‘traditional’ year? We don’t know the answer,” he adds.
In theory, it could go either way, he says, with AI either increasing productivity and skills exposure, or becoming a crutch preventing workers from developing higher skills.
Learning the ropes without “starter jobs”
Fresh graduates lament the conundrum they face – that employers expect work experience even in entry-level positions.
Low Peck Hoon, a senior career coach at tech education firm General Assembly, says the company has observed an increasing number of fresh graduates globally attending its bootcamps and workshops to learn digital skills such as coding and data analytics.
She adds that upskilling is no longer for mid-career workers, and that it is just as important for fresh graduates to participate in project-based learning and build a professional portfolio.
“Great ways to start would be to seek out short or free workshops and courses by established providers, attend networking events to build relationships with a variety of industry peers, and document your achievements to build a strong portfolio,” she says.
For Koh, the data science graduate, his post-graduate internship at car rental startup GetGo turned out to be “one of the most fulfilling and best internship experiences” he has ever had, where he got to fully immerse himself in coding, “get (his) hands dirty” and learn directly from like-minded seniors.
The pay was low at just S$1,000, but he “consoled” himself at the thought that he learnt a lot through the experience.
In fact, he wants to tell other graduate jobseekers who are struggling to keep an open mind, and that “it is not paiseh (embarrassing) to take an internship”.
“It’s a temporary role, and it may not be the usual path that people take, but you just need to treat it as a stepping stone because it may actually help you. You may meet people who can refer you, and also become equipped with more technical skills,” he said.
And that is exactly how it has turned out for him. About six months in, one of his colleagues referred him to Deloitte, where he has been working as an analyst since May.
Government intervention?
Observers point out that if graduate unemployment levels continue to rise, there could be wider implications.
“A high youth unemployment (rate) is concerning as it will undermine consumption spending and limit opportunities for youth, posing short and long-term risks to Singapore’s economy,” says Tan from Moody’s Analytics.
Ives Tay, an independent consultant on SkillsFuture accreditation and compliance, notes that it also could delay marriage and home ownership, while a misalignment between education and job outcomes is a waste of talent and resources.
For employers, AI might reduce the short term-need for junior hires, but “skipping them entirely risks breaking the long-term talent pipeline,” according to the SignalFire report.
“The industry’s future depends on equipping the next generation with skills that grow alongside the evolving technology landscape.”
Asked if the government should consider bringing back Covid-era incentives to encourage employers to hire fresh graduates, most watchers are ambivalent.
Tan says such incentives would be helpful but expensive and unsustainable, while Assoc Prof Ho says it is necessary to also consider the impact they would have on the hiring of other groups of workers, including mid-career ones.
Tay says they may ultimately be “treating symptoms, not causes” and could risk “institutionalising dependency”.
“Incentives alone won’t fix the underlying mismatch between graduate output and workforce readiness,” he adds.
More broadly, watchers agree that what policymakers can do is to ensure educational outcomes remain aligned with industry needs.
One issue though, is just the nature of the education training cycle, where decisions are made today for jobs four years later, says Assoc Prof Theseira.
He adds that training to very specific skills is “probably also not a good idea for the students’ lifelong employability”, given how skill requirements can change rapidly.
“So a mix has to be found between job and skill-specific training, and general training that allows students to adapt in the future.”
