SINGAPORE - Around 50,000 local jobseekers were hired by 14,000 or so companies in September under a scheme to encourage firms to boost their manpower plans, according to preliminary estimates out on Friday (Jan 22).
About 50 per cent of the new hires were aged 40 and over.
The scheme, known as the Jobs Growth Incentive, aims to spur firms to hire more locals, with $1 billion set aside to provide wage support for these workers.
Firms that hire local workers from September last year to February this year will receive a subsidy of 25 per cent of the first $5,000 of their gross monthly salaries for up to one year.
The co-payment goes up to 50 per cent for workers aged 40 and above.
These figures are encouraging as a good start, said Manpower Minister Josephine Teo at a briefing on the sidelines of a visit to food services firm Select Group.
"We also know that the recovery of companies from the impact of Covid-19 would be uneven," she noted.
"Some businesses may struggle to pivot, while others may experience new spurts of growth and bring in more people."
She added that the incentive is meant to help transfer people from sectors that might be downsizing to those that are continuing to expand and hire.
"However, businesses may hesitate to expand right away, and may wish to be more certain about their opportunities before hiring.
"The JGI was intended to boost the hiring momentum and encourage these companies to bring forward their hiring plans and accelerate the hiring of Singaporeans."
Mrs Teo added that the ministry is assessing if the scheme, which was created as a further help to firms as the Jobs Support Scheme tapered off, needs to be extended.
Food services was the top sector of those industries hiring workers with 7,700 local hires. This was followed by wholesale trade, professional services, construction and education.
Experts and companies agreed that the scheme was useful in helping to support hiring.
Select Group managing director Vincent Tan said: "It supports growing companies in the hiring of the local workforce. In Select Group, we have hired close to 50 local full-timers since the start of the scheme."
Seoul Garden group general manager Garry Lam added that it has hired over 20 locals since September.
"It will encourage more food services establishments to hire from the local workforce instead of relying on foreign talent," he said.
Mr Kurt Wee, the president of the Association of Small and Medium Enterprises, added that the scheme is a catalyst in helping firms to be more decisive when hiring.
"It is important because businesses are still in a tough environment with uncertain economic conditions. Sometimes they hesitate, but with the scheme, they can be more certain. Having said that, they will not hire beyond that which is sustainable."
Associate Professor Lawrence Loh from the National University of Singapore Business School agreed: "It will be a rational balancing act for every company - each will weigh the incentive for local hires with any possible saving from foreign recruitment. With the expected recovery, time is also of a critical factor."