New foreigner hiring rules 'put off MNCs'

Resulting staff shortage may cause firms to pack up or scale back, says business group

The Straits Times, Yasmine Yahya, 21 Oct, 2011

MULTINATIONALS are finding it so hard to find skilled staff in the light of the new rules on hiring foreign workers that some may scale back their operations here.

That was the stark warning from the Singapore International Chamber of Commerce (SICC), which has called on the Government to review the policies.

It suggests that the measures, which apply to all sectors in a standard form, be fine-tuned and tailored for specific industries.

The SICC's call echoes one earlier this week by the Singapore Business Federation, which raised concerns about the foreign worker levy.

The worker shortage appears to be showing up across the board, from a lack of chambermaids in the hotel sector to a need for engineers for manufacturers and drivers for logistics companies.

SICC chief executive Phillip Overmyer told The Straits Times multinationals and big local firms from many industries are finding it very difficult to fill vacancies.

Mr Overmyer cited the case of two hotels at the integrated resorts that held a recruitment drive last year to find up to 50 people in service and maintenance roles.

The hotels have to abide by a strict quota of foreign workers and so need to find Singaporeans instead.

About 400 Singaporeans applied for various positions but not all turned up for the first round of interviews and even fewer for subsequent interviews.

By the end of the process, only four people accepted jobs and, after just a week, two of them quit. The other two followed within a few weeks.

Mr Overmyer said the hotels remain understaffed.

'Because there are so many other jobs, most Singaporeans don't want to take up service jobs. Singaporeans don't want to wait on people or work shift hours,' he said.

The result has been feedback from guests slamming service standards as 'terrible', he added.

'This is the kind of thing we're hearing more and more at the integrated resort hotels - and this is an industry we just created only a few years ago.'

Mr Overmyer noted that companies in sectors such as manufacturing, oil and gas, education and construction engineering face similar challenges.

Even though Singapore is a logistics and distribution hub for many companies, it is tough for bosses to find locals willing to work as drivers or warehouse operators, he said.

He noted that the foreign worker policy could have consequences throughout the economy, beyond the immediate affected firms.

Mr Overmyer also pointed to international schools, such as the Singapore American School and the Overseas Family School, which will have to meet stricter criteria when selecting and hiring teachers from next year.

Principals are concerned that some of their staff might not make the cut and it would be tough to find replacements. That in turn could make Singapore a less attractive place for expatriates to work and raise their families.

Eventually, if it becomes increasingly difficult for multinationals to bring in foreign employees, they will likely move their Asian headquarters to Hong Kong or another neighbouring city, he said.

The recent moves made by the Government to tighten controls on the hiring of foreigners have made many of these firms nervous.

'Nobody is packing up just yet, but they are waiting and running the numbers. If this continues, you would probably see some companies shrinking their Singapore operations over the next few years, and this would mean fewer jobs for Singaporeans,' Mr Overmyer said.

The SICC is surveying member companies on foreign manpower issues.

Its preliminary findings show more than half of the 120 companies polled so far saying that access to foreign talent was an important factor in helping them decide to set up or expand their operations here. And while they prefer to hire Singaporeans, they often find it hard to recruit and retain locals.

Some companies are considering outsourcing certain business operations but they fear this will not be a viable solution as those third-party operators are also likely facing similar manpower issues, Mr Overmyer said.

The SICC hopes the Government will take a more targeted approach towards its foreign worker policies, he added. The policies should be industry-specific and not so broad that the same policy applies to all sectors.

'We might be able to find a way to shrink some industries but not others. If we don't take action to allow the big guys to play as they've been playing here for the past several decades, I'm very much afraid they will leave in a few years.'

Mr Gan Chin Yean, managing director of US precision engineering firm Interplex, said the problem of finding staff is real, even for a multinational like his.

'It's just difficult to get locals... So we may have to move our operations to Malaysia or elsewhere if the foreign worker policy continues to get worse.'