Singapore needs to develop self-sustaining workforce policies, says Tan See Leng

Singapore is accelerating technology adoption and equipping Singaporeans with skills for future jobs. ST PHOTO: DESMOND WEE

SINGAPORE - Singapore needs to develop self-reliance and self-sustaining workforce policies, said Minister of Manpower Tan See Leng.

Dr Tan is in Geneva, Switzerland, to attend the International Labour Organisation Conference.

Speaking virtually at Nomura's annual investment forum on Wednesday (June 8), Dr Tan said another pandemic could hit and if there are border restrictions, Singapore will face labour issues again.

'If we don't build that resilience, if we don't build our own self-sustainability, then I think as a country, it will be very tough for us to be able to compete and survive," Dr Tan said.

To that end, he said the Government has made developing a strong Singaporean core in the workforce a key priority.

It is doing this by accelerating technology adoption and by equipping Singaporeans with skills for future jobs.

At the same time, Dr Tan acknowledged that there is a need for a diverse workforce which comprises both local and foreign workers.

Dr Tan said the Government recognises that the local workforce is insufficient to meet all the needs of businesses.

Hence, he said, it is essential that Singapore can attract the right foreign workforce who will bring in the skills that will complement the local workforce.

Mr Euben Paracuelles chief Asean economist at Nomura, said there is definitely a case to be made for complementing the Singapore core.

He said the workforce is ageing and some skills are highly specialised.

To address the challenge of an ageing workforce and to enable older Singaporeans who can and want to continue to work, the Government will raise the statutory retirement age to 65 and the re-employment age to 70 by 2030.

It has also introduced measures to help mid-career workers above the age of 40 to learn new skills so that they can switch careers, or re-enter the workforce.

Singapore's small and medium-sized enterprises (SMEs), which employ about 70 per cent of the local workforce have adapted, said Mr Ang Yuit, vice-president of the Association of Small and Medium Enterprises (Asme).

Mr Ang said SMEs used to be focused on the younger staff, but have now turned to the older workforce as another resource pool.

Even as SMEs diversify their workforce, they still face challenges recruiting and retaining younger employees between 20 and 40 years old, Mr Ang said.

"Retention is a challenge, Wage increase is a challenge. In some sectors, the competition for talent is so serious, you just can't find workers," he added.

Mr Ang said the talent shortage is across the board, from retail staff on the shop floor to highly skilled workers in digital marketing, IT support development and software development.

Based on what Asme is hearing from the ground, SMEs would appreciate if the foreign worker requirements are tweaked to allow them to have greater access to foreign manpower, he said.

He hopes there will be consultation between policymakers and the industry on this issue.

Mr Ang is also the CEO of digital solution agency The Adventus Consultant.

He said that some SMEs, like his, are going overseas to cope with the manpower crunch.

He was speaking to The Straits Times from the Philippines, where his project team is based.

Mr Ang said his development team is based in Vietnam and India, and Singapore is his base.

"There is no way I can build a strong tech team in Singapore. They will not stay with an SME. They will jump to TikTok or Facebook or other unicorns," he added.

Mr Paracuelles said this trend of SMEs going overseas is happening globally.

It is not necessarily negative for Singapore, he added, saying that it is more efficient and cost-effective for companies to outsource certain operations that can be provided in other countries at lower costs.

In the longer term, Mr Paracuelles said, Singapore continues to face the challenge of boosting labour productivity within the Singapore core.

He said that it will be difficult for firms to face wage pressures continually without their workers increasing their productivity.

According to latest data from the Department of Statistics, labour productivity as measured by the growth of value added per worker was 2.1 per cent in the first quarter of this year, compared with 5.8 per cent in the previous quarter.

"It's important for us to also make sure that the workers continue to improve their productivity. Just wage increases without corresponding increases in productivity and output are not going to be able to be sustainable," Dr Tan said.

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