GE issues – SkillsFuture, the billion dollar pipe dream?

skillsfuture_progBy Reperio Simon

In our earlier post, we wrote about the “gatekeepers”, FCF and TAFEP. Since we have managed to get past the gatekeepers, let’s see what’s really behind the gates: Jobs, and how they will be available and created.

The latest “innovative” step is the creation of SkillsFuture, a national movement to provide Singaporeans with the opportunities to develop their fullest potential throughout life, regardless of their starting points. Through this movement, the skills, passion and contributions of every individual will drive Singapore’s next phase of development towards an advanced economy and inclusive society. The government will fund this movement to an average of over S$1 billion per year from now to 2020.

So, say, you are into innovation and want to upgrade yourself. A course available through SkillsFuture costs about $300 to $600. The same course is available on Coursera and is absolutely free, by the Penn State University. For three to five hours a week of classes, you finish with a certificate, if you are into collecting certifications.

Or perhaps you are aiming big and want to lead strategic innovation in organisations. The Vanderbilt University offers such for free on Coursera and yes, it comes with a certificate. Not many of the 8,000 over courses have any real value in terms of skills upgrading. Obtaining a certificate does not automatically make you skilled in the particular area you signed up for. It can make you more knowledgeable, but skill is a different issue.

Tharman Shanmugaratnam, Deputy Prime Minister, Minister for Finance and Chairman of the SkillsFuture Council

So why are we spending S$1 billion per year on upgrading courses? SkillsFuture has itself created a million dollar industry, which is not needed in the first place because the knowledge is actually free and available on the Internet. What’s needed is a computer terminal and internet access. In fact, it should be pointed out that while SkillsFuture might give you certification and some new knowledge, it might not really help you get a new job.

Job creation – The dynamics and changing landscape

More skills, more knowledge, can’t be bad for anyone, right? That’s absolutely correct, but what if you had all the knowledge and skills plus experience to boot but there’s no job?

Manpower Minister Tan Chuan-Jin was quoted as saying that “the point of SkillsFuture is that as businesses restructure and move up the value chain, jobs will evolve too, he told the House. Singaporeans need to move towards higher-value skills, so that they can stay relevant and take advantage of opportunities in the new economy.”

The Minister is not wrong, but what he fails to address is job creation and how that comes about. SkillsFuture is based on the primary assumption that Singaporeans will be more employable when their skills, knowledge and experience are upgraded. The more dangerous assumption, which gives rise to the above is that job creation is not a problem in Singapore. If this assumption fails, so will SkillsFuture.

The problem is compounded further by this concept that the “higher-value skills” that Minister Tan spoke about would bring in more job opportunities. In reality, technology and automation is killing jobs fast and changing the nature of work.

So where are we in terms of job creation? If we look at our employment based on occupations over a 10 year period (from SingStats), we are looking very much like what the Huffington Post said – in terms of the top tier jobs of professionals, managers and executives, it fits the trend of a slowing top and eroding middle.

Employment type 2005 to 2014For now, opportunities for technicians seem to keep us afloat for a while, and MOM has lumped them together in the PMET group. How much longer this trend of increasing technician job vacancies will continue, no one knows. What is certainly clear is that the lower tier jobs are on the increase. Just survey the job adverts in Singapore and you get a good feel of the number of low end jobs available vis-a-vis the mid range to high end jobs. We are headed into a very compromising position.

So perhaps Khaw Boon Wan wasn’t entirely wrong when he said that university degrees are useless except that he did not mention why in its entirety. We are quickly educating people out of a job so SkillsFuture isn’t going to be the silver bullet. The writing is on the wall and we have to look at it for what it is.

With that in mind, perhaps Dr Chee Soon Juan of the Singapore Democratic Party was right when he said during the launch of the party’s economic policy paper that, “you can have all the retraining you want, but if you are going to continue to re-employ foreign workers, they are going to compete with re-trained workers, what good is it going to do?” Jobs need to be created first before we talk about re-training skills.

Job creation – who does what

So who creates jobs and how does it come about? It’s not all that complicated really. Government, companies and individuals (entrepreneurs) create jobs.

In the case of the government, it creates jobs directly and indirectly. It can employ people into the civil service but it can’t employ all of us. Alternatively, the government can outsource services and so on, to create jobs in industries such as transportation, etc. The government can also create environments that are conducive and promote businesses so that companies can create (or at least keep) jobs. Government agencies like the Economic Development Board provide incentives for businesses, while Spring Singapore has incentives for startups, growing businesses and developing industries.

That’s a lot of incentives and initiatives, which also means plenty of billions from tax payers, either given directly or indirectly to private entities. It is like giving people money to create jobs for us to get paid. Makes sense?

Companies employ people not for charity. Their key purpose is to make profits for their shareholders. In which case, their loyalty isn’t to Singapore, no matter how attached they are to the country. Once profits are affected, there are not too many options – cut costs, retrench staff, close down or uproot and go elsewhere. There’s no real discussion here to be made.

Individuals create jobs through entrepreneurship or start-ups. Start-ups don’t create many jobs, they start small and usually are lean in terms of staffing. They may grow to a sizeable company but it takes time. Start-ups also have an amazing failure rate. Frequently, the trend is that they make it big and then sell off (also known as exit strategy), the founders reap the benefits while the fate of workers hang in the balance.

There’s plenty of hype in start-ups, but is there anything really coming out of entrepreneurship in Singapore? Within the list of top 50 start-ups in Singapore, how many were started by Singaporeans?

The problems behind job creation and what needs to be done

It should be apparent by now that jobs are not created by skills training schemes, nor is it right to say that skills training schemes will help secure jobs. There is no simple fix. There are several areas that need addressing – education, the makeup of our economy, the culture and meaning of work, and so forth. It’s a multi-dimensional problem and skills is only one dimension.

Image - Channel NewsAsia
Image – Channel NewsAsia

Our education system is one big factory churning out workers for industries, leaving no spare time for children to discover and pursue their interests. It’s exams, results and the overwhelming pressure to get to the “right” answer. Observation, interest, spare time, the ability to probe, availability of resources regardless of “track record” – that’s all there was to creating something truly groundbreaking, as the case of an 18 year-old Texan who invented a $20 water purifier to tackle toxic electronic waste polluted water. How much does NEWater costs? Our system clearly needs a revamp, the sooner the better.

The makeup of our economy is also not helpful in job creation. Manufacturing is very much a sunset industry, yet Singapore still banks heavily on it, when even in China’s companies have used robots to replace 90% of their workforce. What’s more worrying is the breakdown of foreign and local owned enterprises – more than half that are value added are foreign owned. Where do their loyalty lie?

We seriously need to rethink what “work” means to us and perhaps this would be a good starting point. With disengagement at work rising, we could be undoing our own opportunities for good jobs. The narrow focus that the government has on jobs will be our undoing if we follow along.

Mr John Chan from SDP has a point when he said that every individual is a creative being. It’s not a motherhood statement. Technology and automation does not create jobs, neither do governments and companies. Underlying all these is the individual who can create. Technology and automation cannot create anything unless we first create them. It maybe up to us to create our own jobs for one and another in the future.