UK companies in S’pore hire more locals after EP changes, but dial back investments in dim climate: Poll
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Singaporeans and permanent residents made up 69 per cent of those working here for the firms surveyed.
PHOTO: ST FILE
SINGAPORE – British companies here have stepped up hiring locals since a points-based framework for Employment Pass applications was rolled out in September 2023, noted a new survey.
It found that 26 per cent of 50 firms polled had taken on more local workers as a result of the Complementarity Assessment (Compass) framework kicking in, although most of the companies felt that they could have accessed the talent they needed anyway.
The firms polled by the British Chamber of Commerce Singapore (BritCham) in September 2024 ranged from small and medium-sized enterprises to multinationals. The results, which were released on Oct 24, pointed to a mixed outlook, marked by increased customer demand but also caution amid global headwinds buffeting Singapore.
BritCham found that the total workforce size of respondents in the past six months expanded by 18 per cent. Singaporeans and permanent residents made up 69 per cent of those working here for the firms surveyed.
Meanwhile, the number of foreign nationals who require a form of employment pass working at these firms shrank by 4 per cent, compared with a 5 per cent expansion in the previous poll carried out in August 2023.
However, the chamber noted the availability of top-tier talent and eligibility for work passes remain concerns here.
Around 25 per cent of respondents indicated that they were unable to secure a necessary employment pass for candidates they hoped to hire, with another 30 per cent saying they could not find the talent they needed.
The firms outlined a number of challenges, ranging from the ability to hire locals to issues with infrastructural and living costs, as well as a mismatch in skills due to changing business needs.
“The gap in specialised skills, along with limited overseas exposure, were flagged by respondents as the most likely issues preventing the hiring of Singaporeans into senior-level roles,” the BritCham report said.
Nevertheless, it noted that 42 per cent of respondents plan to expand their workforce over the next six months, adding: “While there is an equal split in those facing retention challenges and those without issues, companies are committed to offering structured training and mentorship programmes to develop their employees.”
BritCham also found that 94 per cent of firms polled expressed confidence in Singapore’s long-term future as a business hub, seven percentage points higher than in April 2024, while 90 per cent or so underscored the importance of Asean’s significance to their business plans.
Moreover, they reported growth of 19 per cent in sales and 12 per cent in orders and advance bookings here since the poll in April 2024. Cash flow also increased by 8 per cent, continuing the upwards trend from a contraction faced in August 2023, BritCham noted.
However, the cost of doing business, inflationary risks, and consumer demand top the list of business challenges, reflecting global economic conditions, the chamber added.
“As a result, investment plans have contracted by 12 per cent, after an earlier 6 per cent expansion in April.”
Ms Nele Cornelis, executive director of the European Chamber of Commerce (Singapore), said: “European companies are keen to continue their investments in the region, with Singapore remaining the centre of gravity for European business in the Asia-Pacific.”
She also said European multinationals are committed to investing in Singapore’s economy and contributing to the local workforce by hiring Singaporeans, adding: “At the same time, foreign talent plays an important role in expanding the economic potential for Singapore.”
While the Compass framework generally works well and has brought more transparency to the process, there are concerns about the framework’s salary criteria, which can make it difficult for companies to rotate non-Singaporean middle managers or junior executives, Ms Cornelis said.
“These roles are often crucial not because of local skill gaps, but to provide international exposure and development for future leadership in global operations.
“Additionally, the emphasis on university degrees as a primary qualification for the Employment Pass poses challenges, particularly for businesses that rely on specialists such as highly skilled technicians and other experts in niche fields.”
