Now it is the desk jockey's turn to worry, as companies merge and automate operations to save costs in the island nation's recession.

Analysts say the current slowdown marks a watershed for the job market because even when the economy recovers, the unemployment rate is not expected to return to the low 2per cent of the early 1990s.

Unemployment, which struck the manufacturing sector hardest at the start of Singapore's current recession, has now spread to other sectors of theeconomy.

In the first nine months of last year, one in three of those laid off was a white-collar worker and the majority were mid-career, government statistics show.

Not only has the iron rice bowl been broken, Singaporeans also have been told to brace for wider income disparities in the years ahead, as those with talents in key areas are paid better than those in lagging industries.

It is the skilled worker in industries such as life sciences and technology who is in greatest demand.

Headhunters and employment agencies say that apart from fresh graduates, those finding it hard to secure jobs are staff in specialised positions and older workers who cost more to retain.

``The finance sector is the second or third largest group of professionals we have on our database,'' Malek Ali, vice-president of marketing at employment agency jobstreet.com, said. ``They are increasing.

``We're seeing that specialists in the sector, like a settlements officer, find it difficult to move on.''

Those with transferable skills, such as front-end customer service or administration staff, have a better chance of finding employment in other industries, he said.

The shake-up in the banking industry, with five banks merging into three, has led to several rounds of cost cuts and lay-offs with thousands of bank employees now out of work.

``Last year was a horrible year for investment banking and the bank mergers were what kept a couple of investment banks afloat,'' said a former employee of a US investment company who was laid off this year.

``At this point, all the deal flow is coming out of China and generally North Asia, so the focus is really shifting away.''

Singapore's largest bank, United Overseas Bank, last December told 435 employees their services were no longer needed. The bank, which took over fourth-ranked Overseas Union Bank, expects to lay off some 2000 workers due to duplication.

OCBC Bank, the smallest bank, had said some 345 people were expected to be laid off by the end of March 2003 with a further 355 set to go after the first quarter, as part of its integration with Keppel Capital and its subsidiaries.

Consolidation of foreign banks such as Fuji Bank, Dai-Ichi Kangyo Bank and IBJ by Japan's Mizuho Holdings, and cutbacks by investment firms have also added to employment woes.

``Unemployment usually lags economic recovery, the issue there is how much of it is structural in nature,'' Sim Moh Siong, economist with Salomon Smith Barney, said.

Despite the lay-offs, some 760,000 foreigners live and work in the tiny state of 4 million, with hundreds of thousands employed in the construction sector and as domestic help.

The country's foreign talent policy has come under scrutiny, compelling the government to explain why its citizens should not resent foreigners working there.

Headhunters say employers often have no choice but to employ foreigners, especially for top positions.

``If there wasn't a need for it, we wouldn't be here,'' said Alex Shipley, a US advertising executive. ``Every modern industrialised country employs foreign talent and Singapore is not an exception.''

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