All in on AI: PM Wong’s promise of ‘no jobless growth’ sets stage for more labour interventions

SINGAPORE – Anxieties about artificial intelligence dominated the debate last week on Singapore’s Budget 2026, which outlined a national push to adopt the technology across all segments of society.

The push received cross-party support as no MP from the ruling party or opposition Workers’ Party argued against it.

But many lawmakers fleshed out scenarios where various segments of Singapore’s workers could be left behind or made unemployed by AI adoption.

Some raised concerns that AI would automate away jobs traditionally done by fresh graduates, creating a “broken rung” in work experience, while others said they were concerned about mid-career workers whose jobs might also see competition from the technology.

All in all, MPs covered almost every segment of society and raised fears that they could lose out in the coming AI push, as well as concerns about AI’s possible environmental impacts.

Their fears are well founded and reflect a deep and growing global anxiety surrounding the technology.

There is still a lack of worldwide consensus on whether the technology will actually improve lives, although local statistics on worker displacement in Singapore have not yet raised alarms.

On Feb 23, a day before the debate began, a post on newsletter platform Substack went viral for its depiction of a doomsday dystopia caused by artificial intelligence. It triggered stock sell-offs of some of the companies it named, contributing to a small dip in the US’ S&P 500 Index that day.

The authors from Citrini Research had modelled a scenario where unchecked proliferation of AI across the US economy would cause rampant unemployment by 2028 while continuing to grow the economy overall and creating what the authors called “ghost GDP (gross domestic product)”, or economic growth with no actual people involved.

The thought experiment also envisioned a collapse of real wage growth and white-collar workers being replaced by machines and forced into lower-paying roles.

While various tech and finance leaders later came out to say it was overblown and alarmist, the uncertainty around AI adoption’s possible outcomes persists.

Singapore’s latest – and broadest – AI push remains, at this point, something of a gamble.

It entails the Government establishing a new National AI Council, company tax breaks for AI adoption and a new AI hub, as well as measures to help individual workers learn AI skills, like six months of free premium AI tools for those on related courses.

But the Government has argued that it is a bet that Singapore cannot afford to pass up now.

Still, MPs’ fears prompted Prime Minister Lawrence Wong to offer guard rails around this bet.

Wrapping up the debate, he promised that widespread AI adoption will not result in jobless growth – the first and perhaps most important principle in how the Government will seek to shape the technology’s adoption.

He also agreed to three calls from the National Trades Union Congress: to empower every worker to be “AI-ready”; to strengthen support and safeguards for workers; and to strengthen the labour movement’s ability to protect and uplift professionals, managers and executives.

The size of these promises cannot be overstated, and – depending on how they take shape – could present more interventions in the labour market.

PM Wong has in the past expressed a willingness to address the failures of the free market in creating good jobs with more state intervention.

In October, as he launched a scheme to link residents to jobs near them, he said that even as Singapore forges on with economic transformation, the creation of good jobs and effective job matching cannot be left entirely to market forces.

The PAP has also over the last 11 years shown that it is willing to adopt targeted interventions in sectors where wages are depressed, and implemented the Progressive Wage Model, which mandates that lower-wage workers in some sectors advance to new wage bands as they hit productivity and upskilling targets.

His promise may mean that further interventions to “strengthen support and safeguard workers” could be on the table, if widespread displacements from AI do emerge.

It is too early now to say what shape some of these interventions could take, but what several backbenchers have asked for could offer a glimpse.

Labour chief Ng Chee Meng and other labour MPs during the debate called for tweaks to the Jobseeker Support Scheme, which gives involuntarily unemployed people up to $6,000 a month for six months.

They asked for the scheme’s income ceiling of $5,000 to be pegged to the median wage for many white-collar workers, which was $7,600 in 2025.

PM Wong said the scheme is only a year old and the Government will study its outcomes before making a decision, but did not close the door on their suggestions.

Moves in this vein could represent a shift in how the Government will deal with the labour market in the age of AI and the ruling party’s thinking about the value of a free market, at least in this arena.

This could have implications for party politics, depending on if and how it comes to pass. It could shrink the political space for WP, which has long differentiated itself from PAP by calling for more redistributive measures and denouncing the ruling party for an over-reliance on the free market at the expense of Singaporean workers.

But a promise is not yet policy and any interventions are, at least for a start, unlikely to go beyond the established playbook of investing in skills and working closely with businesses to ensure these skills are recognised.

PM Wong, in agreeing with the labour movement’s calls, said the Government will invest “more deliberately and more systematically in our people”.

He also said the Government will pay close attention to how companies apply AI, and “guide them to use AI to enhance human skills and expertise”.

In the backdrop of these discussions was a large and unexpected Budget surplus of $15.1 billion – which WP criticised amply, with several of its MPs calling out the Government for what they said was overcollecting of taxes and failing to accurately forecast.

PAP backbenchers defended the surplus but asked for it to be redistributed to Singaporeans, with some asking for more public transport subsidies.

The debate brought out an ongoing tension between giving as much as possible to Singaporeans as soon as possible in good years, and using tax revenues to build foundations for programmes the Government says will be better for the country in the long term.

PM Wong defended this approach and said some parts of surpluses have always been immediately disbursed to Singaporeans, pointing to schemes like the SG60 vouchers.

A newly released measure of wealth inequality here – found to be higher than income inequality – also added context to the debate and produced suggestions from both sides of the House to raise wealth taxes.

Here, backbenchers were in agreement that Singapore can do more to push equality, but there was little shift in the Government’s position.

PM Wong said the Government will continue to study ways to moderate excessive wealth concentration “carefully and responsibly”, but noted that redistribution has its limits.

He will likely need to continue to defend these two positions for the rest of this term of government if surpluses continue.

The unknown factor in this is again AI – if it proves not to be a social and economic leveller, and worsens inequality quickly, the discussion on how much and how to redistribute will be revisited in the House soon.