In times of economic uncertainty, it is natural that more people worry about jobs. How is the 4G (fourth generation of political leaders) team thinking about this? What plans do we have to deal with a potential fallout? How will we ensure our people continue to have good jobs? Let me try and unpack the challenges and opportunities into the short, medium and longer term.
In the short term, we may or may not have a downturn. In a general downturn, how we respond depends on our assessment of the causes - whether they are cyclical or structural, or both. It will also depend on the severity of the impact - whether broad-based or sectoral, shallow or deep. These considerations will shape our strategy for recovery.
In recent memory, the most severe downturn was the global financial crisis (GFC) triggered by the collapse of Lehman Brothers. I was then serving as a union leader in NTUC. At the start of 2009, the International Labour Organisation projected up to 50 million job losses worldwide. In Singapore, economists estimated up to 100,000 job losses when annual retrenchments typically did not exceed 15,000.
A downturn can be worrying. What is more worrying, however, is when there is no end in sight. This can happen if the fundamentals of an economy are not strong, for example, the economy is not well diversified or many industries have lost competitiveness.
Even with strong fundamentals, getting a weakened economy back on track takes imagination, resources and some luck. Fortunately for Singapore in 2009, we had the resources to help companies obtain financing, and retain and upskill their workers.
Helped by improving external conditions, our economy managed to avoid a significant contraction that year and charged ahead by more than 14 per cent the next. During the entire episode, the resident unemployment rate rose but stayed below 5 per cent. By the first quarter of 2011, unemployment had returned to pre-crisis levels.
As it currently stands, a downturn like the scale and scope of the GFC appears very unlikely. But the most significant point is that our economy today is well diversified, more so than in 2009, a decade ago. While some sectors like electronics have weakened, other sectors like information and communications are holding up well, and still hiring.
For now, we should keep a close watch over the economy. At the same time, keep sharpening our competitiveness and grow where we can.
In the medium term - make the best of demographic and technology changes.
More countries have seen their total fertility rate fall below replacement levels. Of the 10 Asean member states, five are in this category. How can we better support marriage and parenthood? Populations are also ageing. Countries like Japan are asking what it means for their citizens to live the 100-year life.
Singapore too will experience a dramatic demographic transition in the next decade. With a calibrated pace of immigration, our citizen population aged 25-64 will be stable. But the population of citizens aged 65 and above will almost double from half a million today to about 900,000 in 2030.
As of 2017, Singapore had the highest life expectancy at birth in the world, at 84.8 years. We also have the highest healthy life expectancy at birth, at 74.2 years. These are projected to rise further with continued advances in healthcare. With Singaporeans leading longer, healthier lives, how do we turn longevity into opportunity?
The second challenge is driven by technology.
All over the world, there is a worry that many workers will be left behind in a future where automation and artificial intelligence have replaced humans. For Singapore, there are actually many more upsides than downsides to technology.
This is because we are fundamentally labour-constrained. For years, our economy has created many more jobs than we have people to do them. Today, it is supported by a workforce of 3.5 million when we have a local workforce of just 2.3 million.
The right strategy is to help businesses grow in a more manpower-lean way. It will also pave the way for sustainable wage growth. Technology-enabled productivity growth is therefore an opportunity not to be missed.
It will be many years of hard work before we take full advantage of the productivity uplift that technology can bring. Not everything can be automated. Workers will still be needed in a variety of roles. But we must help them gain mastery by using technology, so they need not fear but embrace it.
In the long term - focus on career mobility through job creation and job transformation.
While we prepare for the demographic and technological challenges in the medium term, we must not lose sight of the long term.
In the longer term, what we do on the jobs front is ultimately shaped by Singaporeans' aspirations for work. What is our vision? What future do we care to create?
Tomorrow's workers are not looking for jobs just to put food on the table. Many more want careers that engage their imagination and energies, give them meaning and purpose.
At the same time, our people want opportunities for change and progress. At different stages of our lives, some jobs are more appealing than others. This is why we need career mobility, allowing our people avenues and pathways to transit as their needs evolve.
How do we enable career mobility? Is it achievable for the broad majority?
My answer is yes, provided we can do two things consistently well.
The first is job creation, because there can be no careers without jobs.
Our capacity for job creation remains reasonably strong. From 2011 to last year, in only eight out of 32 quarters did we see our job vacancy to unemployed person ratio dip below one. This means that most of the time, we have more jobs than job seekers to fill them.
But make no mistake - there is stiff competition for investments and jobs.
As the heat intensifies, we must work hard to continue attracting home-grown and foreign companies to base their operations here. We must also work smart, to build up where we have an edge and leverage external resources when it's better to do so. Our politics must not cause investors to lose confidence, because it will be ordinary workers that pay the price, not politicians.
Beyond job creation, we need job quality.
While a high job vacancy to unemployed person ratio signals an abundance of job opportunities, we must ask why some vacancies remain unfilled.
Some vacancies remain unfilled because the job quality falls well below the expectations of our people. How do we work with employers to upgrade jobs, striking a fine balance between industry needs and worker aspirations?
The reality is that a slack labour market does not give businesses much incentive to improve job quality. A little tightness is necessary and why we sometimes have to make unpopular policy adjustments, such as moderating access to foreign manpower in some sectors. It goes without saying that help is readily available to companies which make the effort to improve job quality, so they are more attractive.
This also brings us to the second requirement for career mobility, job transformation.
At the point of creation, jobs may be very attractive. Over time, they can lose their shine.
In the 1970s, among young women with secondary school-level qualifications, bank tellers were a "hot job". Today, these young women can advance to ITE, polytechnics and further. A bank job might excite them more if it involves digital marketing or data analysis, and a pathway to bigger responsibilities.
Jobs should also be continuously redesigned so that workers can contribute more meaningfully.
Central kitchens now use auto-fryers, which relieve aching shoulders, and free up cooks to focus on food quality. Closed-circuit television and video analytics now allow security guards to monitor many more buildings without lengthy patrols and sore feet. Flexible work arrangements help to retain staff who otherwise leave to manage their caregiving duties.
Transforming jobs is therefore at the heart of our future economy plans. Restructuring of the economy creates new jobs and also causes some jobs to disappear. But the broad swathe of jobs that remain must also be refreshed.
This must involve businesses themselves. Job transformation is ultimately a result of decisions taken by companies to change operating models, invest in new processes or equipment, open up new lines of business or reset work arrangements.
Workers know this only too well. When their employers fail to transform jobs, put their skills to better use or accommodate their aspirations, they seek out other employers who can. This is why it is also in the best interests of businesses to keep re-inventing their businesses and jobs at the same time.
As jobs are transformed, we create a healthy demand for skills to be upgraded. The two go together.
Think of our focus on jobs and skills as a pair of wings. We need both to fly.