The "iron bowl" of job security is cracking in Singapore as government bodies and state-linked companies alike trim their workforces in a massive restructuring exercise aimed at getting the island's economy into shape for intensifying competition.

Last month's announcement by state-owned port operator PSA Corp. to cut 800 jobs, or 13.3 per cent of its workforce, is evidence the government is sparing no effort to make Singapore Inc. leaner, analysts said.

Even the island's venerable Housing and Development Board (HDB), which houses more than 80

per cent of Singaporeans today in subsidised flats, did not escape the overhaul.

The 43-year-old statutory agency will be downsized and about 900 of its 8,000 employees have opted to resign.

While the retrenchments will add to the pain Singaporeans are already enduring due to a severe downturn two years ago, the economic prescription is what the island needs in the face of pressure from regional rivals especially China and Malaysia, the analysts said.

"It certainly is a sign of the times for Singapore Inc.," said David Cohen, economist from MMS International.

"There is no free lunch. Maybe they (government) are overly disciplined... but it is a slippery rope once you start relaxing," he told AFP.

Singapore's economy has undergone a radical change in recent years, most notably in the financial sector where the government has introduced a series of changes aimed at pushing the local players to become more competitive.

Some of the world's well known lenders such as Standard Chartered Bank and HSBC were granted licenses to offer a full range of financial services and the securities industry was liberalised.