Singapore’s service sector will one day see a reduction in foreign workers who’s willing to work here for the pay that they’re being offered.
Minister for Manpower Josephine Teo disclosed that this is one of the main reasons why Singapore needs to reduce its dependency on foreign employees in this sector.
“It wasn’t an easy decision to make. We had to mull over the decision many times,” she said while referring to Finance Minister Heng Swee Keat’s Budget 2019 announcement on the cut of foreign worker quota in the services sector.
Dependency Ratio Ceiling (DRC) is the quota that calculates the maximum permitted ratio of foreign workers to the total workforce that a company can hire. As such, the DRC for this particular sector will be reduced in two stages – from the current 40 per cent to 35 per cent by 2021.
In addition, the S Pass sub-DRC will also be brought down further from 15 per cent to 10 per cent eventually in 2021.
Due to the growing middle class in South-east Asian countries, there might be chances for foreigners to decline services jobs in Singapore if they get a similar salary in one of these countries.
Minister Teo said, “We have to ask ourselves this question: ‘Do we think that it will always be a case where we can get an indefinite supply of foreign workers?’
“And if the answer to that is ‘No’, then we’d better think twice about that and adjust our policies.”
On top of that, positive outcomes from adjusting the DRC cuts will slowly lead to more sustainable business practices, holistic job redesigns and reskilling of local workers to adapt to an increasingly digital future.
The Government will also be giving a helping hand to firms to achieve this and more, by expanding schemes and new initiatives, like when Finance Minister announced a slew of measures worth S$1 billion to assist local companies transform.
Ms Teo assured that there won’t be changes to DRC quotas in other sectors. The Manpower Ministry will not also be raising foreign worker levies, and it will not also be making any changes to the current policy for Employment Pass holders.
As for incentivising companies to hire workers, especially older ones and those who have been made redundant or are at the edge of retrenchment, Ms Teo said that programmes from the Manpower Ministry’s ‘Adapt & Grow’ initiative, like the Career Support Programme (CSP), has proved to work. In fact, such Workforce Singapore programmes have successfully placed more than 76,000 jobseekers into new roles.
Despite the Government’s move to reduce foreign workers in service sector is slowly taking place, many netizens are still unsatisfied and question what about foreign Professionals, Managers, Executives and Technicians (FMETs). They wrote their dissatisfaction on Channel NewsAsia’s Facebook page where around 170 comments were received.
Others even requested that the Government remove Foreign Talent (FT) so locals will be given the jobs.