If you weren’t at the recent Post-Budget LM Conversations dialogue with Manpower Minister Lim Swee Say and Second Minister for Manpower Josephine Teo at the NTUC Centre, don’t worry.
By the time you read this, you would be up to speed on most of what went on.
Together, they touched on the recent Manpower Ministry (MOM) Committee of Supply announcements and explained the reasons behind the initiatives.
Overarching topics included transforming and growing the economy, helping the workforce adapt and grow, making employment practices more fair and inclusive, creating better local and foreign workforce synergy, and ensuring workers have enough money for retirement.
If you’ve been with the union for a while, you might know that the past three years have seen Singapore face low job growth and an increase in retrenchment numbers. The resident unemployment rate has also gone up on average.
Before 2015, the Singapore workforce was growing at 4 per cent a year – that meant almost 120,000 more workers a year. But productivity was low and stood at only 0.4 per cent.
Although there was 4.4 per cent GDP growth on average, we knew that this wasn’t sustainable in the long run.
Singapore has a limited supply of new local workers every year, and this supply is shrinking due to declining birth rates. If we were to maintain a yearly supply of 120,000 new workers, more foreign workers would be needed.
Mr Lim saw this as a problem, and rightly so.
New foreign manpower pumped into the workforce in 2012 to 2014 was about 40,000 a year. So, if we had continued to grow the workforce at 120,000, we would have needed to increase yearly foreign manpower supply to perhaps 80,000 or even 100,000, depending on how many locals entered the workforce that year.
Doing so would be undesirable because it would mean the local workforce would one day become the minority.
As for productivity, staying at 0.4 per cent a year would mean Singaporean workers, the members you represent, would lose their competitiveness. With salaries growing at a higher 3 per cent a year, it would be a matter of time before that happened. Eventually, our wages would stagnate. We wouldn't want this, would we?
A new strategy was needed.
In the last three years, we shifted focus from manpower growth to productivity growth.
Manpower growth has decreased from 4 per cent a year to 1 per cent a year in the last three years. This has helped, in a way, to prevent us from depending on foreign workers too much.
Productivity has also gone up from 0.4 per cent in the few years before 2015 to 1.8 per cent on average in the last three years.
As a result, unionists like you can now fight for higher wages (good to know considering National Wages Council recommendations are in two months’ time). After all, an increase in productivity should lead to an increase in wages.
Although 2.8 per cent growth in GDP (1 per cent manpower growth + 1.8 per cent productivity growth) isn’t higher than 4.4 per cent, Mr Lim argues that it is of better quality.
“Quantity growth isn’t sustainable,” he said, “but quality growth is.”
Despite this, Singapore hasn’t yet met its target. Our growth strategy is 1 per cent manpower growth paired with 2 per cent productivity growth, resulting in 3 per cent GDP growth.
Also, productivity growth has been uneven, as not all industries grew its productivity at the same rate.
Mr Lim also said that MOM is concerned about the slower workforce growth of 1 percent.
“Would this turn into a bottleneck and strangle the growth of the Singapore economy?” he asked.
As revealed at the MOM COS announcement, two-thirds of the workforce today is local, and one-third is foreign.
The local workforce is today growing more slowly, and Mr Lim predicts that local workforce growth would stagnate within the next 10 years.
Unless Singapore increases its population, or we open the floodgates for foreign manpower, Singapore workforce growth will slow down steadily in the next decade. Both aren’t feasible solutions.
To this end, we must do more with what we have. Mr Lim put it as an equation in his MOM COS speech: 2/3 (local workforce) + 1/3 (foreign workforce) must be >1.
To adopt technology, and make every job (both those held by local and foreign workers) more productive are some ways we can do that. This also focuses on the quality of our workforce rather than the quantity.
Companies need to become more competitive to grow. Otherwise, job creation will be affected.
Currently, MOM’s strategy is for companies to transform their businesses to become leaner. Lean, according to Mr Lim, means growing faster in the face of slow manpower growth.
However, the whole is greater than the sum of its parts.
We are now looking to make entire industries lean instead of individual companies at a time.
The plan is to get companies from the same industry to come together, pull resources, and transform the whole industry. The idea is to create more and better jobs in all sectors.
Creating better jobs and transforming industries would amount to nothing if the local workers who are supposed to take them on are not skilled.
Among the two-thirds that comprise the local workforce the long-term unemployment rate has risen since 2016 and remains at 0.8 per cent.
Therefore, MOM has come up with initiatives such as the Adapt & Grow programme to help jobseekers, including retrenched professionals, managers, executives and technicians (PMETs), Rank-and-File workers, and older workers.
Workers will also get help to achieve work-life balance after the Government announced at this year’s Budget that it would set aside about $30 million to further promote flexible work arrangements (FWA) through the enhanced WorkPro Work-Life Grant.
At this year’s Budget, MOM has also enhanced support for rank-and-file workers through increased salary funding of the place and train programme, and the new Career Trial programme.
The Career Trial programme is an enhancement of the Work Trial by Workforce Singapore and NTUC’s e2i (Employment and Employability Institute). Mrs Teo said the aim is to help Singaporean jobseekers try out more jobs and choose new careers.
Low-wage workers have also been receiving support to improve their salary through initiatives such as the Progressive Wage Model over the past few years. And now, MOM plans to extend the model to other sectors to improve the lives of more workers.
As you may have read in the news, MOM placed 500 companies who had unfairly hired foreigners over locals on a watchlist.
Companies on the watchlist would have their employment pass applications scrutinised by MOM. The Tripartite Alliance for Fair and Progressive Employment Practices would then engage them to improve their HR practices.
Of the 500 companies, 150 have shown good progress and exited the watchlist.
On the other hand, MOM has barred 60 companies, which were uncooperative and showed no sign of improvement, from applying and renewing employment passes for foreign employees until they adopt fair HR practices.
Mr Lim also urged unionists like you to flag to MOM any companies you suspect are preferring to hire foreigners than locals.
There are also measures to recognise employers who have good HR practices such as the Human Capital Partnership.
The result? Out of every 100 new PMET jobs created, 78 went to locals. Mr Lim said he was quite encouraged by the progress, but also noted that more could be done.
We can all agree that all local workers need fair job opportunities.
So, in its COS session, the ministry announced enhancements to the Fair Consideration Framework. Now, all companies with 10 or more employees must advertise their job positions that pay less than $15,000 in the national Jobs Bank for local workers for at least 14 days.
Previously, it was only for employers with more than 25 employees and positions that pay less than $12,000.
MOM also raised the minimum qualifying salary for S Pass from $2,200 to $2,400 to ensure these foreign workers have the experience and quality.
All resident workers are also now protected under the Employment Act. The Labour Movement has been pushing for this in the past few years.
Previously, there was little protection for PMETs who earned more than $4,500 under the Act.
Civil servants, domestic workers and seafarers, however, will not be covered as they are covered separately, such as by other Acts.
Also, the Tripartite Alliance for Dispute Management (TADM) and Employment Claims Tribunal will also be a one-stop place to resolve employment disputes, such as salary claims and unfair dismissals.
Freelancers also have their own sets of challenges and need protection.
To do this, MOM has revealed the Tripartite Standard on Contracting with Self-Employed Persons, after consulting with various stakeholders such as the unions.
One effort would be that TADM will extend voluntary mediation services to freelancers who don’t have sector agency mediation services.
Also, A new tripartite committee called WSH2028 has been set up to improve the state of workplace safety and health.
The committee will investigate how to minimise deaths at the workplace further.
Last year’s figures showed workplace fatalities at 1.2 per 100,000 workers, but by 2028, the plan is to bring this figure down to less than one.
We understand that all these initiatives and policies are a means to something, but what exactly?
Mr Lim summed it up perfectly in the conclusion of his COS speech.
Addressing the chair of the House, he said: “Sir, we firmly believe that a job is the best welfare. Full employment is the best protection for our people. Together with our tripartite partners [this includes you as union leaders] at the national and sector levels, we have to do our best to transform across all sectors for our economy to transform and grow pervasively, as One Singapore Unlimited.
“We also have to do our best to create better jobs, better skills for everyone to adapt and grow inclusively, as One Singapore United.
“Advances in technology will destroy many old jobs, globally and here in Singapore. But if we do more together, to build new and better capability faster than our competitors, we can move ahead and stay ahead – To make every enterprise a better enterprise, every job a better job and every worker a better worker. Together, we can strive for innovative, inclusive and sustainable growth for everyone.”
