By JOYCE HOOI

IN WHAT could well be one of Singapore's most trying recessions, the local job market has displayed a bewildering resilience.

According to a Morgan Stanley Research report, despite 'GDP growth averaging 1-4 percentage points lower in the four quarters since the start of the recession in Q2 2008', quarterly net employment has seen a higher average increase of 36,850, compared to other recession years such as 4,675 in 1997 and minus 25 in 2001.

This has been chalked up to capital expenditure left over from the large momentum of the go-go years that is still being carried out now.

'Historically, hiring has been strongly tied to capex rather than GDP growth,' the report stated.

Propping up hiring in recent quarters are areas such as pharmaceuticals, healthcare and hotels, which had previously commissioned capital expenditure.

Net employment in the petroleum and chemical industry, for example, has seen an average growth of 2,633 in the three quarters since the start of the 2008 recession, compared to 67 in 1997 and none in 2001.

While the job market might be holding up, employees are feeling the wage pinch, demonstrating the lack of end demand, which tends to be inflationary.

'In spite of what looks like relatively slower job losses, real monthly earnings have still worse declines compared to the 2001 cycle.'

While the job numbers could bolster domestic demand and confidence, consumers have held back on spending, worried about more job losses in the future or deterred by the lack of income growth.

Consumers might do well to be wary about breaking out the bubbly, given the capex-driven nature of the resilient job market.

The report pointed out that if the job market is only being supported by lagged capex and not by structural elements like healthier balance sheets, the job losses just might catch up with workers when capex dries up.

This article was first published in The Business Times.