Top professional services firms like PwC, KPMG and Boston Consulting can operate from anywhere in the world, and it is important for Singapore to remain attractive to such businesses so that its people have opportunities to develop their potential, Trade and Industry Minister Chan Chun Sing said yesterday.
Speaking to reporters on a visit to PwC's office in Marina One, he cited three factors that attract such firms here: access to talent, connectivity and innovation.
"Singapore's reputation as a hub for talent is hard-won. But at the same time, this reputation can also be easily lost if we are not careful," he said, underlining the need for the country to look at strengthening its ability to grow and attract talent to serve the global market.
Singapore must also strengthen its connectivity - including in terms of flows of data, finance and technology, he said.
"If we continue to do this well, then we have every opportunity to continue to excel as a global business hub with a very strong, vibrant professional services sector."
With Mr Chan on the visit were Manpower Minister Josephine Teo and Minister in the Prime Minister's Office Indranee Rajah.
It is part of an ongoing series of visits to companies in key sectors to look at how they are faring amid the crisis and making adjustments for a post-Covid-19 world.
Mr Chan noted that the professional services sector underpins Singapore's status as a business hub, and how well it does will determine and shape the future trajectory of Singapore's growth. It contributed 5.1 per cent to Singapore's nominal gross domestic product last year.
"The sector does not just create jobs for Singaporeans in Singapore, it also creates very high value-added and challenging jobs for Singaporeans beyond Singapore, and that is how we are able to grow our external wing as well," he said.
He also noted that the sector is one with little, if any, geographical insulation - meaning anyone, anywhere can compete with Singaporeans or Singapore businesses without being here.
"It is all about who has the best team, who has the talent, who is able to better connect with his clients and who can better innovate. The competition is no longer local (or) on a single domain."
The minister cited PwC as a good example of a firm that has transformed, providing a range of services that complement one another.
About the sector
Singapore today serves as the regional hub for leading professional services firms in consulting, accountancy, architecture and engineering services, as well as legal services and advertising.
5,500 Number of new professional, managerial, executive and technical jobs a year.
4.6% Average growth rate per year to reach $31 billion in value-add.
Current total employment in this sector: 255,800
The professional services sector contributed 5.1 per cent to nominal gross domestic product last year.
SOURCES: ECONOMIC DEVELOPMENT BOARD, MINISTRY OF MANPOWER
Mr Chan also said there is an opportunity for Singapore, with many companies concerned about being able to operate across different markets in a bifurcating or fragmenting world. They find it important to be based in a place where they can service different parts of the global ecosystem, he noted.
He outlined various ways in which Singapore plans to strengthen its competitive advantage in the sector.
It is establishing conditions for the sector to thrive, including building a network of digital economy agreements that will help professional services firms access overseas markets, and strengthening its workers' competencies.
Singapore must also enhance its people's exposure to internships overseas, and continue to encourage citizens to get regional experience so that they can take up regional and global positions.
And it has to be able to draw talent here to contribute.
He recalled how a businessman told him that while this may be the crisis of a generation, it can also be "the opportunity of a generation for Singapore to attract the very best from all around the world to come and join Team Singapore".
This will create more opportunities for Singaporeans here as well as beyond Singapore, Mr Chan said.
"We are committed to strengthening our attractiveness to businesses and talent to (get them to) join Team Singapore in order for us to excel against our competitors," he added.
Ms Indranee, who is also Second Minister for Finance and National Development, said that in the medium and longer term, professional services are a major growth area. "We do have the talent and ability here," she said.
She added that while 70 per cent of law firms reported a drop in work due to the recession, areas such as insolvency, litigation and dispute resolution services are picking up.
Corporate and transaction work has taken more of a hit, "but there's potential for mergers and acquisitions as investors start to... look for the ones they can pick up and invest in".
What is crucial is helping law firms position themselves for future growth when the economy picks up, as legal services demand will also recover, she added.