(SINGAPORE) Singapore's job creation machine was still humming in the third quarter of the year, but not as strongly as earlier thought.

Final numbers released yesterday by the Ministry of Manpower (MOM) show 20,500 jobs were added to the economy in the July- September quarter - lower than the 24,100 figure it estimated in end-October. Nearly all of the job gains came from the service sector.

MOM's latest report on the labour market shows employment growth continued to ease quarterly from 36,500 in the first quarter and 24,900 in the second quarter.

But the 82,000 jobs created in the first nine months were still a big jump from a year ago, when the economy was mired in recession.

Job growth then was almost flat, at just 100.

'It's clear now that this has been an excellent year for job recovery in Singapore after the dull job landscape of 2009,' says Lynne Ng, regional director of recruitment firm Adecco SEA.

Despite the moderation in the latest employment figures, she expects continued job growth next year, which will push up pay.

'The need to hire strong team members and to retain valued employees will, we expect, see employers offer competitive salaries and salary increments in 2011,' Ms Ng says.

This could spell bad news for the nation's push for higher productivity. For while pay is set to increase, labour productivity growth over the year slowed by more than half in the third quarter - from 15 per cent in the second quarter to 6.3 per cent, according to MOM's report.

It said this was mainly because the effects of the cyclical upturn have started to wear off.

But the report also shows growth in nominal earnings over the year easing from 5.8 per cent in the second quarter to 5.4 per cent in the third.

'Coupled with a slight increase in inflation in the third quarter (at 3.4 per cent compared to the second quarter's 3.1 per cent), the increase in real earnings was 2.1 per cent, which was 0.5 per cent-point lower than in the previous quarter,' it says.

While the report shows job gains in the third quarter to be smaller than first estimated, it noted that the jobless rate dipped slightly from a seasonally adjusted 2.2 per cent in June to 2.1 per cent in September.

'With the unemployment rate now at an overall 2.1 per cent, it's likely that we will not see this drop too much further,' Adecco's Ms Ng says. 'This is the lowest that unemployment has been in Singapore over the past two-and-a-half years.'

Long-term unemployment also fell as the number of resident workers who had been hunting for jobs for at least six months declined to 0.5 per cent of the resident workforce in September, down from 0.9 per cent a year ago.

The number of redundant workers - those retrenched and those whose contracts were terminated prematurely - also continued to decrease, from 2,280 in the second quarter to 1,930 in the third.

Nearly six in 10 of the resident workers laid off in the second quarter were rehired by September, up from 43 per cent in June.

The services sector accounted for the bulk of the job gains (21,300) in the third quarter, while manufacturing employment fell (minus 700), though by less than in the second quarter (minus 2,300).

After slight gains in the previous quarter, job growth in the construction sector was flat.

The report says this was because of the completion of several big building projects like the integrated resorts, and fewer new ones coming on stream.