Why S’pore Needs Both Local And Foreign Talents

Singapore has long been known for its liberal foreign worker policy, from blue collar foreign workers to expatriate white collar workers.

The city has also long been a coveted choice for expats seeking entry into Asia – low tax rates and favorable government policies are just a few of the reasons.

In fact, Singapore was rated the top overall destination for expats in 2017, for the third year in a row.

Encourage employers to hire locals

singapore office workers
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However, it seems that the city-state is not as welcoming to foreign talent as it once was.

In a recent turn of events, the Ministry of Manpower (MOM) increased the minimum wage required for foreign workers.

From September 1, 2020, companies applying for new Employment Passes (EPs) for foreign workers will be required to pay them a monthly salary of at least S $ 4,500, compared to S $ 3,900.

From October 1, medium-skilled foreigners on the S Pass will also see their eligible salary increased from S $ 2,400 to S $ 2,500.

The move was implemented as part of plans to encourage employers to hire more Singaporean workers.

In early August 2020, the government also put 47 companies on the Fair Consideration Framework watchlist for alleged discriminatory hiring practices.

Although the names of the companies were not mentioned, they were placed on the list because of their high proportion of foreigners employed in the categories of professionals, managers, managers and technicians (PMET).

In yesterday’s parliamentary debate (August 31) – the first since the July general elections – competition from foreigners for jobs took over.

Several members of parliament (MPs) have raised concerns that Singaporeans are losing jobs to foreigners, especially in this time of economic crisis.

While they recognized this fact, MPs also mentioned that there was a caveat – Singapore must maintain an open market and remain open to exploiting the skills of foreign workers.

Foreign investment: Singapore’s open borders are a necessity

Singapore Causeway
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Job Passes attract and anchor high-value activities and investments in Singapore.

Despite the Covid-19 pandemic, Singapore’s Economic Development Board (EDB) managed to secure foreign investment worth S $ 13 billion in the first four months of 2020.

These include electronics and information technology companies such as Micron, Lazada, Shopee, and Thermo Fisher Scientific, all of which plan to hire staff in the next few years.

Their [foreign talent] The presence gives Singapore a vitality that keeps us economically relevant and also provides jobs and opportunities for our fellow Singaporeans.

Opposition Leader Pritam Singh in Parliament on Monday August 31

That said, some global companies may require highly specialized skills and knowledge, which experienced internal employees tend to understand well.

To put this in perspective, if a Singaporean company were to open its headquarters overseas, it is likely that they would send a Singaporean management team.

However, these global companies in Singapore still need executives and other white collar roles, which would be open to Singaporeans.

In his first speech as Leader of the Opposition in Parliament on Monday August 31, Pritam Singh of the Workers’ Party acknowledged that Singapore needs foreigners to “contribute to the dynamism of our economy”.

In addition to generating thousands of jobs for Singaporeans, these investments will also boost Singapore’s economic growth and productivity in the long run.

A possible gap in education: a lack of soft skills?

singapore education system
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The question of whether Singapore’s education system adequately prepares locals for available jobs has been a matter of contention for years.

One of the main justifications given for hiring foreigners is that companies are unable to find Singaporeans with the expertise.

If this is indeed the case, it is essential to identify these gaps in Singapore’s education system.

Since 2018, the Singapore government has said it needs to attract foreign talent, especially in the tech industry, as the country’s education system “rebalances itself.”

We need to rebalance so that education is more fun, more joyful, more holistic, and children have a passion and an ability to decide what they want to do.

It’s not just about my grades but also about developing my passion, an idea of ​​my future, my background and acquiring general skills.

Mr. Ong Ye Kung, then Minister of Education, in an interview with the Straits Times (September 2018)

The then Minister of Education, Mr. Ong Ye Kung, pointed out that while Singapore’s education system has its strengths, there may be too much emphasis on exam results, which leads to the proliferation of rote learning.

This sentiment is echoed by Tan Hwee Hoon, associate professor of organizational behavior and human resources at the Lee Kong Chian School of Business at Singapore Management University.

She noted that although Singapore is competitive, challenges remain due to the emphasis on rote learning. According to her, employers need a “sense of adaptability” and soft skills that Singaporeans might lack.

Singapore graduates know a lot, but these can be learned on the job. What is more important are the practical and soft skills that can help them excel in the workplace.

Mr. Ong Ye Kung, then Minister of Education, in a speech in 2016

Indeed, employers are moving towards general skills. According to a TODAY report, data from LinkedIn shows that recruiters favor candidates with both general and technical skills.

Willingness of residents to accept jobs held by foreign workers

foreign workers from singapore
Image Credit: Salt and Light

In Singapore, most manual or blue-collar roles are occupied by foreign workers.

According to a report by Channel News Asia, Peh Ke-Pin of contractor PQ Builders had difficulty finding Singaporean workers.

Although he is willing to pay S $ 2,000 to S $ 3,000 for a local, he still has no takers when he posts ads.

Due to the mindset that some jobs like laborers, technicians, and technologists are for low-skilled people, many Singaporeans have reservations about these jobs.

Consumers must also be prepared to pay more for goods and services if businesses are to raise wages to attract locals.

Additionally, OCBC chief economist Selena Ling said Singapore’s low fertility rate and aging population meant it needed migrant workers to fill these jobs.

Is local hiring just a transitional measure?

While the government’s latest initiatives are seen as a strategy for Singapore to ensure a balanced workforce of local and foreign labor, they could be a double-edged sword.

First, it could increase costs for businesses in the long run, which could hamper their recovery from the COVID-19 pandemic.

In addition, rising costs could also deter global companies from setting up operations and head offices in Singapore, which could lead to lower foreign investment inflows, employment opportunities and GDP.

Therefore, as with all philosophy and politics, balance is essential.

Singapore is currently experiencing the worst recession in its history, and a push for local hiring is important to secure the livelihoods of Singaporeans.

That being said, it’s important for Singapore to look outward while taking the course and identifying policies that will allow the city-state to move into the post-Covid world.

Featured Image Credit: Ejinsight

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Jothi Venkat

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