Sister Diana Chia, President, NTUC
Brother Lim Swee Say, Secretary-General, NTUC
Brother Tan Chuan-Jin, Acting Minister for Manpower
Brother Stephen Lee, President, SNEF
NTUC Central Committee Members & Union Leaders
Parliamentary colleagues
Distinguished Guests
Brothers & Sisters
Good evening. I am very happy to join all of you here today, at this year’s May Day Dinner.
Economic Outlook
We gather in challenging economic times. The advanced economies continue to be mired in difficulties. In the US, economic growth will be restrained by fiscal tightening, and the lower-than-expected number of jobs created last month has led to concerns about whether growth can be sustained in the world’s largest economy. The Euro-zone has has been contracting since the second quarter of 2012, and is likely to remain in recession this year. While Japan has embarked on an aggressive monetary policy to end years of deflation and boost growth, the effects remain to be seen. China looks set to grow at a lower trajectory than in the past, while India has yet to overcome its structural impediments to realise its potential.
As a small open economy, Singapore is very much affected by what happens in our region and beyond. If the EU and the US economies, which account for nearly 50 percent of global demand, continue to struggle, our economy will also be affected. Based on advance estimates, the Singapore economy contracted by 0.6 per cent on a year-on-year basis in the first quarter of 2013, compared to the 1.5 per cent growth in the preceding quarter. We need growth to provide jobs for Singaporeans, and keep unemployment low.
New Challenges for Singapore
Besides these external developments, we are also seeing changes to the structure of our citizen workforce.
Our citizen workforce is ageing rapidly, and will start to shrink by 2020 as more people retire than those entering the workforce. With Singaporeans living healthier and longer lives, more older workers will want to continue working, perhaps in less physically demanding jobs, and with more flexible work arrangements.
At the same time, our citizen workforce is becoming better educated. By 2015, 45% of each cohort will have access to polytechnic education. By 2020, half of each cohort will have access to a publicly-funded university education, including through Continuing Education and Training. With better qualifications and rising aspirations, we expect two-thirds of working Singaporeans to hold PMET jobs in 2030, compared to about half today.
This transformation is already under way. And the pace of change will pick up in the next few years as the baby boomer cohorts reach retirement age, and smaller, but better educated younger cohorts enter the workforce.
Many Singaporeans aspire to good interesting jobs. But to create good jobs of the future, we need to continue to bring in investments and grow Singapore-based companies. These will increasingly be in emerging new industries or those which reach out to new growth markets. We will need to find the right blend of expertise to grow such new companies and sectors. If we are not able to create good new jobs of the future in Singapore, younger and better educated Singaporeans may leave in search of better opportunities in more exciting cities. And this would hollow out our population and workforce further.
Singaporeans in non-PMET jobs will also be higher skilled, but their numbers will fall by 200,000 by 2030. We will thus continue to need foreign workers to supplement our workforce and support our economic and social needs – including taking care of our seniors, cleaning our estates, as well as building roads, rail lines and homes for all of us.
We know that there are concerns that Singapore has been taking in too many foreign workers, too quickly. Indeed, we have already slowed down the intake of new foreign workers. Many of the companies you work for are already feeling the tightness. The Government will take a balanced approach – not turning off the tap abruptly, but adjusting the conditions for employing foreign workers to lean towards higher productivity and to ensure fair employment practices.
Our unions are working with the Government to encourage businesses to raise productivity and share the gains with their workers through higher wages. To support this effort, Government will co-fund 40% of wage increases given to Singaporean employees earning up to $4,000 per month under the new Wage Credit Scheme.
The new WorkPro scheme will provide help to employers who recruit mature workers and back-to-work Singaporeans, or place their employees on flexible work arrangements. We hope this will encourage more economically inactive Singaporeans to return to work.
There are also concerns about unfair hiring practices. The Ministry of Manpower takes these seriously. Employers who do not comply with the Tripartite Guidelines on Fair Employment Practices will have their work pass privileges curtailed. MOM will also deepen the efforts with companies to develop a local pipeline for Singaporeans to take up better jobs.
The Government is also doing more to help low-wage workers, by focusing on raising productivity. This will help raise the wages of workers and provide them better job assurance. For example, the Workfare Training Support scheme has been enhanced to help more lower-wage Singaporeans to upgrade their skills through training, so that they can improve their employability and have the opportunity to earn more. We are paying special attention to the cleaning and security sectors, so that workers can benefit from training, improved skills and bigger job scopes, and will progressively earn higher wages.
In addition, to supplement the income and savings of low-wage workers, the Government has enhanced the Workfare Income Supplement Scheme to enable 480,000 older and lower income Singaporean workers earning up to $1,900 to receive larger payouts.
Evolving Role of Unions
As our economy goes through a period of restructuring, companies need to focus on revamping their products and services, creating more value for their target market, and restructuring their processes. Improving productivity by merely trying to get more output from less input, but doing things largely the same way won’t do. As our economic structure and the profile of our workforce change, unions will also have to adapt themselves to better cater to the needs of our evolving workforce.
First, taking care of non-PMEs.
These form the core of NTUC’s membership today. According to NTUC’s membership statistics, non-PME members currently form three quarters of NTUC’s more than 700,000 members. Over the years, the unions have worked hard to help our workers to upskill so that they can take up higher-skilled, higher-paying jobs. For example, the Inclusive Growth Programme co-funds projects with companies who embark on productivity improvement projects and share productivity gains with workers earning $1,700 and less. As businesses go through restructuring, our unions will have to work closely with management to help prepare our workers to adapt to these changes, while ensuring that workers continue to receive fair wage increases. Only then can they benefit from our economy’s transformation towards quality growth.
Second, reaching out to PMEs.
Today, PMEs make up about one quarter of union membership. NTUC and its affiliated unions provide them with either full or partial collective bargaining, workplace representation and advocacy, as well as professional development and placement opportunities. Some affiliated unions have also set up professional chapters catering to specific groups of PMEs, such as tour guides and real estate professionals. This is encouraging. The profile of our workforce is changing rapidly. In time to come, professionals, managers and executives (or PMEs) will form the majority of our Singaporean workforce. Some of them have said they want greater workplace representation. Hence, it is important to strengthen our current channels to bring more PMEs into the realm of tripartism. I understand that our tripartite partners do recognise the need for our unions to progressively represent more PMEs, while at the same time bearing in mind that employers also need sufficient flexibility to manage their human resources. A tripartite work group has been studying this issue closely. The Government looks forward to receiving their joint proposal. With our constructive approach towards tripartism, I believe it is possible to achieve a win-win-win arrangement for the PMEs, unions and management.
Third, catering to different types of workers and jobs.
The workforce will become more diverse over time. Our resident labour force participation rate for those aged 65-69 is among the highest in the world, behind only Japan and South Korea. But there is scope to do more to tap this growing pool of older and experienced workers. Our unions have already been working with companies to redesign jobs for older workers, so that they can continue to work productively beyond the retirement age. Based on MOM’s preliminary survey findings, 98% of local employees who turned 62 in the year ending June last year were offered employment beyond 62.
With an ageing population, unions will need to do more, including encouraging companies to tap on the new WorkPro scheme. As we encourage more mature workers and back-to-work Singaporeans to enter the workforce, there may be more people on flexible work arrangements, contract work, or part-time work. The unions will have to see how best to work with businesses to protect the interests of different types of workers in different types of jobs. For example, NTUC has jointly developed with the Law Society, a booklet for freelance professionals to help them manage work issues. There are also regular legal clinics for union members, including freelance professionals.
Management also has a key role to play, in order for our unions to be effective. It is important for management to recognize and accept the constructive role of the unions. With both management and labour working together, we can improve the lives of workers, and help our businesses succeed.
Celebrating Success
We face challenges ahead, but we can take comfort from the strong record of our tripartite model. In many other countries, labour-management relations can be fractious and are often marked by unhappy interactions. In Singapore, the situation is quite different. Our unions work closely with employers and Government to help upskill our workers, and to improve products, services and work processes so that there is more surplus to be shared between the employer and the workers. This translates to better jobs and higher wages for Singaporeans.
I’ve had the opportunity to be Advisor to the Singapore Manual and Mercantile Workers’ Union, and Chairman of the Council of Advisors for the United Workers of Electronics and Electrical Industries. I have seen for myself the important contributions that unions make to the lives of our workers, especially when the sector is going through restructuring or during difficult economic times. It has been the strong tripartite partnerships and the hard work of our union leaders and the industrial relations officers, who have helped our workers through these challenges.
Let me give you one example of how this tripartite relationship is built and nurtured, with the unions taking the initiative. Each year, it is UWEEI, the union, who arranges a lunch meeting where I get to meet the UWEEI union leadership together with the CEOs of the companies whose workers come under the UWEEI umbrella. This is a simple yet meaningful embodiment of the spirit of tripartism. These meetings are useful as they provide an opportunity for the union to update the CEOs on the initiatives the union is taking, and for the CEOs and the unions to discuss issues that are important to them. Together they let me know where government facilitation would be helpful, and I also have the opportunity to let them know the government’s thinking on matters that affect their industry and workforce.
This evening, we honour 93 companies, management leaders, and union leaders who have made a positive impact to the strong and productive labour-management relations, and helped to improve the lives of workers.
Let me congratulate our award winners. I hope that your good work will inspire more companies and union leaders to follow in your footsteps. As Singapore goes through this transitional period of economic restructuring, strong labour-management relations and adaptive unions will become even more important in helping to prepare our workers for the future. I am confident that if we continue to work closely together – Government, unions and businesses – we can build a better future with better jobs and better lives for all Singaporeans.
Thank you very much, and I wish everyone an enjoyable evening ahead.
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