Mr Gerald Giam Yean Song asked the Minister for Manpower in view of the fact that non-residents make up 83,500 of the 88,400 total employment growth in 2023, how will the Ministry ensure that the bulk of new jobs created in 2024 will go to Singapore citizens and residents, including those aged 40 and above.
The Minister for Manpower (Dr Tan See Leng): Mr Speaker, the Member asked the Ministry of Manpower (MOM) to ensure that the bulk of new jobs created go to Singaporeans. I think the Member seems to be under the misconception that a net increase in foreign employment means that jobs are not going to Singaporeans. I just want to clarify if that is so, then that view is fundamentally misguided. So, let me explain why.
Firstly, what MOM is focused on and is interested in is whether Singaporeans who want to find a job can indeed do so. One way to look at this is to examine the resident employment and unemployment rates.
In 2023, our resident employment rate was 66.2%. This puts us as having the fourth highest resident employment rate compared to other advanced economies in the Organisation for Economic Co-operation and Development (OECD). Our resident unemployment rate and long-term unemployment rate remain very low, at 2.7% and 0.7% respectively. So, we are close to full employment.
In fact, the Government has invested much effort in safeguarding resident employment. To illustrate, over the 2020 to 2022 period, when COVID-19 had an impact on our economy and labour market, resident employment growth remained robust, increasing by more than 110,000, while non-resident employment declined by 3,000.
Secondly, with the slowing resident workforce growth, it is imperative that Singapore remains open to complementary foreign labour to meet the demands of our growing economy and our businesses. If you take a closer look at the 83,500 non-resident employment growth last year, about 18,700, or 22.4%, was from higher-skilled Employment Pass (EP) and S Pass holders. The total number of EP and S Pass holders combined is still below pre-COVID-19 levels. The remaining increase of 64,800, or accounting for more than 77%, was due to an increase in the number of holders for Work Permits and other work passes in sectors such as construction. These are not typically the type of jobs that Singaporeans want to do.
Members of the House, there is a global shortage of skilled talent, with global cities competing for both investments and human capital. To stay competitive and to nurture a vibrant corporate ecosystem, we need to ensure that our businesses can access talent and they can expand. Thriving businesses create jobs for Singaporeans. They contribute taxes which, in turn, can be used to improve the livelihoods of our fellow Singaporeans.
We continue to enhance the complementarity of our foreign workforce. We peg the minimum costs of hiring EP and S Pass holders to the top one-third of local professionals, managers, executives and technicians (PMETs) and the associate professionals and technicians (APTs) respectively.
By regularly updating the qualifying salaries based on the set wage benchmarks, we ensure that our EP and S Pass holders are of high quality and they maintain a level playing field for our locals. The Complementarity Assessment Framework (COMPASS), which came into effect for new EP applications in September 2023, also allows us to evaluate EP candidates holistically, based on individual and firm-related attributes. This ensures that employers bring in the right profile of foreign workers to complement our local workforce and that companies develop healthy workforce profiles that are powered by a strong local core.
The fundamental objective of our approach is to strike a balance between ensuring that businesses have access to skills and manpower needed to grow and succeed, while creating opportunities for our local workers to grow and to progress. Our approach has helped our locals to secure good jobs.
Between 2013 and 2023, the number of resident PMETs increased by 380,000; and the number of EP and S Pass holders increased by 50,000. In growth sectors, such as finance, infocomm and professional services, resident PMETs increased by 190,000; and the number of EP and S Pass holders increased by 20,000. But more importantly, over the decade, resident income has also increased by 21.6% in real terms.
So, we must not view residents and foreigners as a zero-sum game and continue to draw divides. Thriving businesses with access to complementary foreign talent will not only lead to more job creation, but also improve overall wage outcomes, as businesses expand and improve their productivity. By growing our economic pie, we will be better able to secure positive outcomes for Singapore and Singaporeans.
Mr Speaker: Mr Giam.
Mr Gerald Giam Yean Song (Aljunied): I thank the Minister for his reply. Can I ask the Minister, what percentage of the 88,400 total employment growth in 2023 were for PMET roles? And of these, what percentage went to Singapore Citizens and, in particular, older Singaporean PMETs?
Dr Tan See Leng: I thank the Member for that question. Of the increase in total employment – the 88,400 – there was an increase of 4,900 residents and 18,700 EP holders and S Pass holders. So, that 64,800, that 77.6%, are actually in sectors or jobs that our Singaporeans do not typically want to go into. So, I think the right comparison would be that 4,900 residents versus the 18,700 EP and S Pass residents.
So, if you compare that increase in employment growth attributable to that segment that I just talked about. Let me repeat that. Residents versus EP and S Pass holders, there were 4,900 jobs for residents versus 18,700 for EP and S Pass holders. The key sectors with the largest increase in employment for the EP were admin and support services, food services and retail trade. For the S Pass, the key sectors were process, financial and insurance services and marine.
The growth last year in EP and S Pass holders exceeded growth in resident employment, as this category of EP and S Pass holders, the non-resident PMET employment is still recovering from the pandemic. The total number of EP and S Pass holders was 393,700 in December 2019 – this was the year before COVID-19. And we ended last year with 383,900 – this was in December 2023.
If you compare over the few years that I talked about, that 100,000 jobs that we safeguarded, as a result of Government efforts to safeguard jobs during the pandemic, our resident employment increased every year since 2019 and the proportion of PMETs amongst employed residents increased in tandem as well. As I have shared time and again, the various COVID-19 measures that we introduced actually safeguarded resident employment during that period to maintain high employment rates. While EP and S Pass holder proportions dipped significantly and it is still recovering back to pre-COVID-19 levels.
Hence, the larger proportion of growth attributed to EP and S Pass holders last year did not affect PMET resident employment at all. I hope that clarifies.
Mr Speaker: Mr Giam.
Mr Gerald Giam Yean Song: I thank the Minister for his reply to my supplementary question, but I do not think it actually addresses the question I was asking. He is comparing the 4,900 residents with the 18,700 EP and S Pass holders. But the 4,900 consists of all the Singaporean growth, all the resident workforce growth, not just for PMETs.
So, if we are to assume that EP and S Pass holders are PMETs, what is the percentage of the 4,900 that goes to Singaporeans?
I listened carefully to the Minister’s reply and I understand what he is trying to get at. But given the substantial Government expenditure used for job creation in Singapore, including the Economic Development Board’s efforts to attract foreign direct investments (FDIs), the extensive tax incentives given to multinational companies (MNCs), if most of these jobs continue to be filled year after year, mostly by foreigners, is the Minister concerned that these Government expenditures appear to be disproportionately benefiting MNCs and foreign workers, in particular, foreign professionals, over Singaporean workers?
Dr Tan See Leng: Mr Speaker, as I shared earlier on, on a like-for-like comparison, you need to look at that 4,900 versus that 18,700 jobs in the same sectors. Because, really, more than 77% of last year’s employment from the construction, process and manufacturing sectors, are typically jobs that Singaporeans do not want to be part of.
So, really, if you want to compare the type of jobs that Singaporeans would prefer to be in and, as I have shared earlier on, our focus is on enabling, helping and facilitating every Singaporean who wants to choose a particular job or role, will be able to do so. So, look at that particular sector and for the record, in terms of the total EP and S Pass holders, it is still about 32% of our overall workforce.
I think to say that we have expended significant Government expenditures, in terms of growing the economy and how many of these jobs end up with residents, I think that is myopic. Why do I say that?
Today, if you look at the overall statistics that we have presented in our Labour Market Report, our long-term unemployment is at 0.7%, 0.8%. And how we classify long-term unemployment is anyone who is unemployed for above six months. Based on a snapshot, our resident unemployment is about 2.7%. So, really, that 2% is churn. Most of them, if they so wish to do so, would find a job within six months. So, it is churn. So, for all intent and purposes, we are at very close to full employment.
We have also shared at the Budget, Committee of Supply, and Deputy Prime Minister has also shared in his Budget Statement, that for us to continue to grow, we cannot just grow the workforce indefinitely. We need to also grow our productivity and our value added.
Businesses, when they thrive, as the economy grows, they need access to workforce; they need access to workers; they need access to foreign talent; they need access to local talent. In a situation where our labour market is so tight, how do we ensure that our startups, our small and medium enterprises (SMEs), our large local enterprises and the MNCs, who make significant FDIs here in Singapore, can continue to grow and tap and leverage on the ecosystem, especially when we are already at close to full employment?
Is the Member, therefore, suggesting that, because of the fact that we are at full employment, we do not, or we put a dampener on our businesses’ ability to grow? I think that is very short-sighted.
I hope that sets the perspective as to what we are thinking. Today, we are at a pivotal moment, with all of the transformation, with the significant disruptions happening, this is our opportunity to work together, to make sure that we continue to create and sustain a thriving metropolis for our successive generations.
Ministry of Manpower
2 April 2024
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Office of the Leader of the Opposition 