Firms hope for more help in Budget to tackle talent crunch

Panellists at roundtable say further support also needed for business transformation

Business and industry leaders are hoping for further support to address the labour and talent crunch as well as help in business transformation, in the upcoming Budget.

While firms are generally cautiously optimistic about the operating environment this year, concerns over rising costs and manpower challenges remain.

These sentiments were shared yesterday at the 13th Institute of Singapore Chartered Accountants (ISCA) pre-Budget roundtable, which centred on the theme of recovery and refocusing on growth.

Key issues such as advancing digital transformation, the push towards sustainability, capability and talent development, as well as driving internationalisation were discussed ahead of Budget 2022, which will be unveiled on Feb 18.

Mr Liang Eng Hwa, chairman of the Government Parliamentary Committee for Finance, Trade and Industry, noted in his opening speech at the roundtable that this year, Singapore needs to look beyond managing the Covid-19 pandemic to prepare for structural shifts such as continued digitalisation, climate change and changes in the global order.

"We need to build a more vibrant and more resilient economy that can meet the challenges of the future and seize new opportunities," he said.

Singapore has to press on with its transformation efforts and support local small and medium-sized enterprises (SMEs), added Mr Liang, who co-chaired the roundtable with ISCA president Kon Yin Tong.

At the session, which was held in a hybrid format, online and at ISCA House in Raffles Place, panellists highlighted the continued challenges of high labour demand and the lack of talent with required skills, which has been exacerbated by the pandemic and border restrictions.

SMEs are at a disadvantage when competing for IT talent as they are up against multinationals and large tech firms, noted Singapore Business Federation's (SBF) chief executive Lam Yi Young.

Singapore Manufacturing Federation secretary-general Lawrence Pek called for government funding to send young locals abroad on internships, where they can pick up new skills to meet the demands of emerging industry trends.

Mr Ang Yuit, vice-president of the Association of Small and Medium Enterprises, suggested that talent development could be incentivised for SMEs by making it a criterion for government procurement projects.

Institute of Human Resource Professionals chief executive Mayank Parekh highlighted the importance of having both employers and employees on the same page about skills training, to ensure that staff get training in the skills that are required and prevent a skills mismatch.

During the session, various business leaders spoke about the spectre of rising costs, given the increasing energy prices, logistical challenges amid global supply chain disruption, as well as the upcoming goods and services tax (GST) hike. With the tight labour market, manpower costs show no sign of abating either.

Continued government relief measures, such as through wage support, would be much welcomed by sectors which remain weighed down by Covid-19 challenges such as construction, retail, tourism and food and beverage, they said.

Panellists also discussed ways in which Singapore could look to drive its green transition and seize new opportunities.

Mr Sam Kok Weng, markets and financial services leader at PwC Singapore, suggested that the Government look at sacrificing some tax revenue to build up the environmental, social and corporate governance sector, with the likes of tax relief for firms which buy carbon credits.

SBF's Mr Lam also stressed the need for support measures to help firms capture opportunities in the green economy.

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A version of this article appeared in the print edition of The Straits Times on January 15, 2022, with the headline Firms hope for more help in Budget to tackle talent crunch. Subscribe