Focus remains on local workforce as report shows slow job growth

16 Mar 17

SINGAPORE

IMPACT – MEDIUM

Singaporean officials continue to stress the need to develop Singapore’s local workforce as a recently released report indicates that unemployment rose slightly last year with net growth in local employment still slow compared to levels seen in years past.

Key Points:

  • The Ministry of Manpower’s Labour Market Report 2016 reported that the average resident unemployment rate rose to 3.0 percent in 2016, a slight rise after it had remained at about 2.8 percent for the four previous years.
  • The report also said that net local employment grew by 11,200 jobs in 2016, up from 700 in 2015, but still lower than levels seen from 2012 through 2014. Net local employment grew by 58,700 in 2012, 82,900 in 2013 and 96,000 in 2014, according to the report.

Background: Singapore has long stressed the importance of not only developing a strong local workforce, but developing employee-lean operations, with officials saying that Singapore’s limited workforce could be a “bottleneck” to growth. Manpower Minister Lim Swee Say was quoted in the Straits Times as telling business leaders at a recent event that MOM would remain flexible as companies adjust to the goals Singapore has set for the economy.

“There’s no disagreement that we need to break the manpower bottleneck. Based on your feedback, I think we are on the right track,” Lim said, according to the report. “In the process, if you need to have some short-term flexibility on our foreign worker policy, we are prepared to consider – on the condition there is a clear action plan to upgrade to transform.”

As BAL has reported recently, Singapore has stepped up its focus on protecting local workers. The government announced in February that it will integrate the Jobs Bank portal with the SkillsFuture platform, allowing Singaporean workers to search for training opportunities and job vacancies at the same time. Authorities have also expanded the number of companies on MOM’s watch list from 100 companies last year to 250 this year.

BAL Analysis: All indications are that authorities in Singapore will continue to focus on promoting the local workforce, which may lead to greater scrutiny of foreign workers and employment pass applications. This seems particularly likely given the slow expansion in the local workforce. That said, Lim’s comments that the government will be flexible with companies in need of foreign workers as they adapt were encouraging. Companies with questions about how best to recruit the foreign workers they need should work with BAL to discuss the best options available to them.

This alert has been provided by the BAL Global Practice group in Singapore. For additional information, please contact singapore@balglobal.com.

 

Copyright © 2017 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@balglobal.com.