AI, offshoring reshape Singapore’s financial landscape

SINGAPORE: The shiny towers of Singapore’s financial district are showing signs of stress as artificial intelligence (AI) and strategic offshoring change the job market. This threatens the city-state’s long-held status as a regional financial centre.

Singapore’s DBS bank plans to cut 4,000 temporary jobs and use AI to replace routine positions. This is part of a larger trend of tech disruption affecting the financial services industry as the hiring climate turns cautious.

Standard Chartered has already eliminated 80 jobs locally, with many roles moving to India. The bank’s job postings reveal a stark contrast: there are 32 operations openings in India compared to just 27 in Singapore, along with 36 product roles in India versus 16 at home.

In a media interaction, recruitment expert Loretta Chan from Amethyst Partners highlights a significant challenge: “Companies are expanding beyond Singapore to neighbouring countries like Malaysia, driven by higher labour costs and strict visa rules.” Junior and mid-level back-office roles are taking the hardest hit from this shift.

The government is taking action through initiatives like the SkillsFuture programme. Recently, Deputy Prime Minister Gan Kim Yong highlighted how it was working closely with six banks to identify jobs affected by AI and to create reskilling plans.

Meanwhile, Hong Kong seems more resilient due to significant investments from China and a focus on front-office jobs like trading and sales. According to the Financial Times, hiring trends in Hong Kong’s finance sector are driven by record-high initial public offerings (IPOs) and an influx of foreign and Asian investors moving money into the Hong Kong market.

While both financial hubs face AI’s changing influence, Singapore is more vulnerable due to its concentration of routine, automatable jobs. Hong Kong’s active front-office environment offers a better defence against technological disruption.

The message is clear: there is no longer any choice but to adapt. Cities must adapt to AI’s changing financial landscape or risk falling behind. Singapore is making a concerted effort to adapt to the changing times.