The trend follows the Labour Movement's advocacies to strengthen the Singaporean Core.
As businesses adjust to policies such as the Complementarity Assessment (COMPASS) framework, the number of S Pass and Employment Pass (EP) holders continues to decline for the second consecutive quarter, according to the Manpower Ministry.
The number of S Pass holders saw negative growth for the second consecutive quarter this year. The total number of EP holders also declined in the second quarter.
The Manpower Ministry released these findings on 17 September 2024 in its Labour Market Report 2Q 2024.
COMPASS is a transparent points-based system that enables employers to select high-quality foreign professionals while improving workforce diversity and building a strong local core.
Companies must earn sufficient points to apply EPs for their foreign workers.
From September 2023, the minimum qualifying salary for S Pass holder renewals was increased to $3,000 for all sectors except Financial Services, while the minimum qualifying salary for new applications was increased to $3,150.
For over a decade, the Labour Movement has called for a stronger Singaporean core.
NTUC Assistant Secretary-General Patrick Tay said he is heartened that the number of EPs and S Passes continues to moderate following MOM’s policy changes to uplift the quality of the foreign workforce.
He added that the trend is in line with NTUC’s advocacy to level the playing field the resident workforce, especially PMEs, amidst an evolving labour force.
One of the key recommendations of the NTUC-SNEF (Singapore National Employers Federation) Joint PME Taskforce in 2021 was to strengthen the Singaporean Core by enhancing the EP application review process and facilitating skills transfer to local PMEs.
Mr Tay said: “During our Budget Committee of Supply Debate 2024, I once again called to strengthen the Singaporean Core and level the playing field for our local PMEs.
“With PMEs making up 45 per cent of NTUC’s membership, we will continue to do more because NTUC cares and we will take action to champion for better wages, welfare and work prospects for our PMEs because #EveryPMEmatters.”
NTUC Assistant Secretary-General Desmond Choo echoed Mr Tay’s response and said that the Labour Movement is glad to see a gradual transition towards higher-quality foreign manpower.
At a company visit on 16 September 2024 2024, Manpower Minister Tan See Leng said: “I think what we're seeing is the fact that some degree of consolidation is also happening amongst the businesses.”
However, Dr Tan also said that this is not a sign that companies are not hiring.
“In fact, if anything at all, we seem to be seeing promising signs of growth coming back ... What we are seeing is that the quality of the EP holders is actually improving.
“It’s more important for you to see how this will develop over a single year or a year-or-year kind of comparison,” he added.
Total employment, excluding migrant domestic workers, in 2Q 2024 was more than double compared to the first quarter, from 4,700 to 11,300.
Non-residents accounted for all the increase, driven by the growth of Work Permit Holders in Construction and Manufacturing.
MOM said these are mainly lower-skilled jobs typically filled by non-residents as residents are not keen to work in these jobs.
Resident employment declined marginally by 600.
Resident employment rose in the Financial & Insurance Services, Information & Communications, and Professional Services sectors, but saw seasonal declines in Retail, and Administrative & Support Services.
Overall, total employment grew in the first half of 2024 by 16,000, with increases in both resident 4,900 and non-resident employment.
MOM expects resident employment growth to moderate in the longer term.
Dr Tan said: “You can expect this to happen given the fact that Singapore already has a very high labour force participation rate and the fact is that our resident workforce growth will slow down.”
Foreign-owned companies account for around 20 per cent of firms in Singapore and hire nearly a third of employed residents.
Dr Tan said: “They also create businesses for our local SMEs who hire the majority of our resident workers. At the same time, even as we update our foreign workforce policies to attract global talent to Singapore, we will continue to invest heavily in Singaporeans because Singaporeans are at the core of what we do.”
The labour market remained tight, with job vacancies exceeding the number of unemployed persons.
The ratio of job vacancies to unemployed persons rose to 1.67 in June 2024, compared to 1.56 in March.
Amidst this tight labour market, unemployment rates improved in June 2024 (overall: 2 per cent; resident: 2.7 per cent; citizen: 2.8 per cent), and the resident long-term unemployment rate remained low at 0.8 per cent in June 2024.
MOM refers long-term unemployment to persons aged 15 years and over who have been unemployed for 25 weeks (approximately six months) or more.
Retrenchments rose slightly in 2Q 2024 from 1Q 2024, from 3,030 to 3,270, but remained low overall (1.4 retrenched per 1,000 employees).
Across the economy, most firms cited business reorganisation or restructuring in Q2 2024 as the reason for retrenchment.
Dr Tan said: “Our retrenchments are low. The figures from the report give us assurance that our employment situation is healthy. By and large, there are more good job opportunities for locals. Our labour market continues to remain tight. Meaning that in general, it's still easier for people to find and to keep jobs.”
Mr Choo said: “Our labour market continues to show resilience and strong momentum, with more job vacancies than unemployed persons and a low long-term unemployment rate.
“With overall unemployment rates declining to 2 per cent as of June 2024, our efforts to secure stable, quality jobs for our workforce are paying off.”
MOM said the labour market performed well in the first half of 2024, and expects the labour market momentum to be sustained, with wages and employment continuing to grow in tandem with economic growth.
It added: “In particular, resident employment is expected to be boosted by Financial & Insurance Services, Information & Communications and Professional Services, as well as the Formula One Singapore Grand Prix and year-end festivities.”
