Blunt approach to curb foreign workers may hurt, not help

Professor Linda Lim suggested curbing foreign worker numbers to reduce income inequality (How to reduce inequality; July 28).

The Singapore National Employers Federation (SNEF) agrees we can do more to reduce income inequality. However, businesses must remain competitive and viable to support the measures.

In this regard, employers appreciate the Government's approach of supplementing the income of lower-wage workers through Workfare. The complementary Workfare Training Support scheme incentivises employers to upgrade the skills of lower-wage workers. The Inclusive Growth Programme enables employers to share productivity gains with workers through higher wages.

Curbing foreign worker numbers will not automatically lead to higher wages for low-wage workers. In the security sector, highlighted by Prof Lim, competitive bidding by service providers for contracts, based on price, consistently depressed wages. The lack of skills made it hard for the workers to seek alternatives.

In 2014, the Progressive Wage Model for the sector was introduced. This enabled security officers to earn higher wages in line with improvements in skills, productivity and job responsibilities.

There are also ongoing tripartite efforts to transform the sector to better leverage technology. This will further uplift the potential for sustainable wage increases from higher productivity as skills are improved, jobs are redesigned and manpower requirements are reduced.

Similar efforts have been made and results seen in the cleaning and landscaping sectors. Even in the public transport sector, the wages of bus drivers have increased in a sustainable manner through our collective tripartite efforts.

In some sectors like construction, curbing foreign worker numbers may increase costs more than raise the wages of local workers. Also there are very few local workers in the sector.

Nevertheless, the construction sector is transforming to attract more locals and reduce the reliance on low-skilled foreign workers.

SNEF supports efforts to develop the Progressive Wage Model and job redesign in more sectors to improve the quality of jobs and reduce manpower reliance. These initiatives will improve employers' ability to pay their workers more.

But to do this, businesses must continue to grow. A blunt approach to curb foreign workers may hurt employees if many businesses are forced to scale down or exit.

Koh Juan Kiat

Executive Director

Singapore National Employers Federation