International Business & Economy Can Singapore afford to reduce the number of its ?

Can Singapore afford to reduce the number of its foreign workers?

If a graying Singapore accepts fewer foreign workers amid reduced interaction with the outside world, can it maintain economic growth?

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Singapore—One of the issues facing the country this year concerns the country’s , as the perception remains that they take away from locals. And because of the economic fallout from the current pandemic, have become an ever-increasingly important matter.

A new article in Nikkei Asia, published on Tuesday (Nov 3), and entitled “Local jobs or global talent? Singapore faces COVID-era conundrum,” looks at the consequences of the possibility of Singapore limiting the number of its foreign workers, whom the country has relied on for its growth and development in the past few decades.

In endeavouring to reserve the best jobs for locals, minimum salaries for professionals and mid-level employees have been raised this year. Nikkei Asia quotes Manpower Minister Josephine Teo saying in a Facebook post, “You may of course adjust your EP or S Pass employees’ salaries upon renewal…But consider the missed opportunities of building up your local employment, and the strong government support to do so.”

Singapore, like other countries, has had to protect local jobs in the age of Covid, which is particularly challenging, given that almost two out of every five people in Singapore is a foreigner. Added to this is the country’s ageing population. In 10 years, around 25 per cent of the population will be age 65 and older.

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The question is this, as Nikkei Asia puts it: “If a graying Singapore accepts fewer foreign workers amid reduced interaction with the outside world, can it maintain economic growth?”

The article quotes associate professor of law at Singapore Management University, Eugene Tan, as saying, “We have thrived by having a combination of domestic talent, augmented by foreign expertise.”

Domestic talent must be developed further, experts say. “If employers’ needs and local job seekers’ needs do not match, a tightening of foreign labor rules may not be very effective. The replacement of foreigners with locals should take place in tandem with the growth of relevant human capital,” a Singapore-based economist at Mizuho Bank, Hiromasa Matsuura, told Nikkei Asia.

The article also quotes an anonymous Australian manager at a financial company who said,  “If there was someone in the local market that could do that work, the companies would love to hire them because locals are cheaper typically. But there’s a reason that they keep bringing in expats. The local skill set doesn’t have what’s required or what the companies are looking for.”

These sentiments were echoed by a French entrepreneur as well. “We cannot always hire Singaporeans even though we want to. If Singapore makes it harder and harder for foreigners … it might lose its openness and be less attractive for investments or for people. And everybody loses.”

The government, recognizing that foreign talent is still vital for economic growth, has said that at least for now, Singapore must remain open, even as it has boosted efforts to upskill and train the .

Prime Minister Lee Hsien Loong said to Parliament in September,

“Our population is small, it is not growing very fast. Soon it is going to level off. To grow our economy, we have no choice but to top up with foreign workers and work pass holders.” —/TISG

Read also: SM Tharman: Jobs will remain challenge over the next year and possibly longer

SM Tharman: Jobs will remain challenge over the next year and possibly longer

 

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