Higher wage demands of workers inevitable, firms need to transform: Tan See Leng

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Higher wages are inevitable amid surging inflation, and companies here need to find ways of competing other than on low labour costs, says Manpower Minister Tan See Leng in an exclusive interview with The Big Story.

SINGAPORE - The higher wage demands of workers amid surging inflation are inevitable, and companies here need to find ways of competing other than on low labour costs, said Manpower Minister Tan See Leng.

"If the only model that our businesses have is depending on low-cost labour, it is not a sustainable model," added Dr Tan, who was speaking to The Straits Times after visiting events management firm Aux Media Group on Friday (July 29).

One possible way, in the short term, would be to "slice and dice" a single role into several smaller ones to attract workers in sectors which are in dire need of staff due to a faster-than-expected rebound, such as hospitality, he suggested.

This would allow more flexible working arrangements that can appeal to untapped segments of Singapore's workforce, such as seniors, stay-at-home mothers and those with caregiving responsibilities.

Dr Tan said: "In the medium and long term... I think we need to think of new ways, whether it's through job redesign, productivity value-added improvements, or even using technology, to see how we can solve some of these bottlenecks."

Increasing workers' wages is a global trend, he said, and employers here are competing with other countries, not just domestically, for talent.

During his trips abroad, Dr Tan said he has met many individuals who recognise the credibility of Singapore's workers. "Because they are more assured of the calibre... they are also prepared to pay higher," he added.

"What's happening around the world in terms of uplifting of wages will directly have an impact on our people here as well."

On Friday, the Ministry of Manpower (MOM) released advance estimates for the labour market in the second quarter.

Dr Tan said his ministry is monitoring layoffs in the technology industry in the region. "We see this as an opportunity for us to leverage this pool of talent as well," he added.

One company that transformed itself during the Covid-19 pandemic is Aux Media Group. It previously specialised in managing real-life events, but the pandemic prompted it to shift to offering extended reality technology.

Manpower Minister Tan See Leng (left) visiting events management firm Aux Media Group on July 29, 2022. ST PHOTO: DESMOND FOO

The technology - which comprises special cameras, and walls and flooring made of display panels - allows presenters to visualise and interact with digital graphics that both an online and on-site audience can see, making for more immersive hybrid events.

The company, a pioneer in extended reality in Singapore, has sent its staff for a customised career conversion programme that it designed together with statutory board Workforce Singapore.

Extended reality production head Richard Ong, 42, who participated in the programme from last October to March, said: "Extended reality combines the virtual environment with the physical environment, so it actually makes you think about what is real and what isn't - that's what fascinates me about it."

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