It looks like things aren’t going to go well on the economic front this year. We’re on the brink of slipping into a technical recession, and the gloomy outlook is expected to result in higher retrenchment figures, a slowdown in employment and horrible news for a whole bunch of industries.
Basically, tough times are ahead, and it pays to brace yourself for what is to come. This is not the time to be obliviously spending all your money on Orchard Road every weekend or quitting your job on a whim. Here are five things Singaporeans should do as we enter 2016.
1. Be aware of an increased likelihood of retrenchment
NTUC has spoken—they predict that in the first quarter of 2016, 234 workers in unionised companies could be retrenched, a 31% increase from the first quarter of 2015.
That’s just the tip of the iceberg. Singapore-based companies are in for a tough year, which likely means lower profits and cost-cutting. And no matter how useful you think you are to your company, there’s a chance your boss thinks of you, yes you, as an unnecessary cost—especially if he can just dump all your work on the guy in the next cubicle.
If you’re an older worker commanding a high salary, beware of retrenchment, as the odds are against you, not only in your search for a new job but also in your ability to replace your previous income.
There’s never been a more crucial time to make sure your skillsets stay relevant and to strive to make a real contribution to your workplace.
2. Don’t quit without another job lined up
Job hopping is nothing new in Singapore, and while the employment market is still pretty robust, don’t quit without another job lined up unless you’re okay with the fact that it’s probably going to be harder to find a new one than it was last year.
While hiring has slowed down just a little since the China stock market crash, expect things to get a lot worse.
It’s so bad that headhunters expect hiring in many industries to slow down or even stall completely in the second half of 2016. Employers are going to find it harder to justify hiring a new guy, so you definitely don’t want to be job hunting desperately at that time.
3. Business owners should reexamine their business processes in light of falling profits
Many businesses here aren’t exactly run in the most efficient way, yet they still manage to turn a profit thanks to being in the right place at the right time.
This year is definitely not going to be the “right time”. If you’re a business owner and haven’t bothered correcting certain inefficiencies, this is the time to do it, as you could be in for some tough times.
While businesses across the board are likely to feel the pinch, if you’re in particularly vulnerable industries like tourism and manufacturing, now is the time to see if there are more efficient, more streamlined and cheaper ways to do what you do.
4. Trim the fat on your expenses
Clearly, this is a year anything can go wrong. Even if you don’t find yourself unceremoniously retrenched, if your company is badly affected you can expect a smaller (or even no) bonus, as many people did during the 2008 recession, or even a pay cut.
This is not exactly the best time to start a designer bag collection or plan a lavish shopping trip to the factory outlets in California.
Unless your income is recession-proof, it’d be a good idea to keep your consumer spending conservative till the danger passes.
5. Check your investments
Everyone’s investment mix is different, but if you’re a stock investor who buys and holds for the long-term, this may be a good year to monitor stock prices more closely.
At this point, many stocks are quite heavily undervalued, and property prices are still on the decline. It’s anyone guess when they’ll rebound, but for now, investors should pay attention.
2016 may be a year of restraint and caution for those of us without obscene amounts of money. But if you play your cards right, it could also be a year that will pay off in time to come.
This post appeared first on the MoneySmart blog. MoneySmart.sg is Singapore’s leading personal finance portal that helps you to maximize your money. Like us on Facebook to keep up to date with our latest news and articles. Compare and shop for the best deals on Loans, Insurance and Credit Cards on our site now!