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Degree-holders easier to get retrenched. True?


I refer to the report “More jobs saved as Singapore emerged from recession“ (Channel News Asia, Apr 26).

According to the Ministry of Manpower's (MOM) Redundancy and Re-employment report 2009:

- Redundancies increased from 8,590 in 2007 to 16,880 and 23,430 in 2008 and 2009, respectively, an increase of 97 and 39 per cent respectively.

- Retrenchments increased from 7,680 in 2007 to 13,920 and 20,160 in 2008 and 2009, respectively, an increase of 81 and 45 per cent respectively.

- Professionals, Managers, Executives & Technicians (PMETs) saw the largest increase both in absolute and percentage terms, from 6,200 in 2008 to 9,570 in 2009 (rise from 37% to 41%).

- The Redundancies by Occupation, 1998 to 2009, shows that for PMETs, it was the highest for the last 12 years.

Since the data shown only goes back to 1998, I believe it may be a record historical high.

So, the more educated and qualified you are, the easier it may be for you to get retrenched.

The share of Redundancies and Retrenchments was also much higher for Residents compared to Non-residents, at 61.9 to 38.1 per cent for Redundancies, and 68 to 32 per cent for Retrenchments in 2009.

So, residents (Singaporeans and permanent residents (PRs)) had a much higher chance of being retrenched, relative to foreigners.

For the Profile of Residents Made Redundant by Educational Attainment, those with a Degree was the highest at 32.1 per cent.

So, people with degrees were the most likely to be made redundant.

The Re-employment Rate Among Retrenched Workers has been falling from 78.7 per cent in January 08 to 50 per cent in December 09, with January 09 being the lowest point at 43.2 per cent.

The Re-employment Rate of those with a degree was the lowest in 2009 at 61.2 per cent.

Therefore, those with a degree, also had the greatest difficulty in getting re-employed.

So, has all the rhetoric over the years, to re-train, re-skill, upgrade our qualifications, been worth it?

To what extent has our liberal foreign labour policies contributed to the woes of PMETs?

Well, let's try to put ourselves in the shoes of an employer.

If we employ a foreign PMET at a monthly salary of say $4,500, we save $652.50 on CPF contributions a month plus annual bonuses, as employers do not have to make CPF contributions for foreign workers.

Employers do not have to pay foreign worker levies for foreign PMETs on employment passes. Only S-Pass and work permit holders need to pay foreign worker levies.

If we employ a male PMET, we don't have to be inconvenienced by the up to 40 days of reservist training a year.

Since foreigner PMETs on employment passes which are typically for two years, we may have less turnover problems, as foreign PMETs may be less likely to switch jobs.

Foreign PMETs from countries with lower wages and cost of living, may generally be willing to work for lower wages.

They may also generally have no families to support in Singapore, like Singaporeans.

So, quite often, perhaps it is foreign PMETs who may be “cheaper, better and faster” than Singaporeans.

With the NTUC and the Singapore National Employers Federation (SNEF) calling for the restoration of CPF, the savings to employers who employ foreigners may increase even more.

With about 140,000 new PRs and about 40,000 new citizens in the last two years, the statistics on foreign PMETs may gradually disappear, and become “locals” (Singaporeans and PRs) statistics.

Leong Sze Hian