Businesses seek clarification on foreign labour policy

By Millet Enriquez, Channel NewsAsia, 12 Nov 2012

More businesses are feeling the crunch from the recent policy changes on hiring foreign workers.

Some companies say the changes have hampered their growth.

Experts say both large and small firms are seeking more clarity and believe that a more targeted approach should be the way forward.

Hunting down cockroaches, mosquitoes and rodents is a job not many Singaporeans are keen to have.

And for firms like PestBusters, the government's tighter foreign labour policy has slowed down its growth.

The company says demand for its services remain high, but it is short on manpower despite spending on prison roadshows, putting up job placements and holding job fairs in Community Development Councils.

Thomas Fernandez, Chairman and CEO PestBusters, says: "It is really, really frustrating.....We are not in manufacturing where we can automate. I can't get robots to go and find a cockroach in the kitchen and kill it."

From a projection of a monthly 10 per cent growth, PestBusters now expects growth to drop to 5 per cent.

It's now looking at overseas markets with plans to close its Singapore headquarters.

The Association of Small and Medium Enterprises says the talent crunch has trickled down to the sub-contractors and had greater impact on the food and beverage, retail, services and construction sectors.

Some companies have even paid liquidated damages for uncompleted or poor quality of work.

While larger multinational corporations (MNCs) are still taking a wait and see approach, experts say stricter salary requirements for senior hires may also lead to some MNC executives relocating elsewhere.

Phillip Overmyer, Chief Executive, Singapore International Chamber of Commerce, says: "Because you're playing in a very high (skills) market, with very sophisticated skills and other things like that, you need other people as well. So you need the skills of Singaporeans and you need the skills of the foreigners all merged together because they have very, very different skills and talents. And if you start losing one piece of them, the whole makeup starts to crumble."

He adds: "It has the potential to lose its shine. That doesn't mean that the companies think Singapore is going to mess the whole thing up. What they are worried about is being certain that the people responsible for sorting through these issues seriously understand the full ramifications of everything that everybody is trying to do."

Still, some companies like Sakae Sushi say the labour policy changes have led companies to rethink their growth strategies.

Douglas Foo, CEO of Sakae Holdings, says: "The limited workforce is a given now. It is the parameter that SMEs will have to continue to operate in this environment. This is a new environment. So within this new environment how do we compete? How do we challenge and how do we upgrade in terms of the skill sets and in terms of being much more productive, in terms of innovative ideas."

Mr Foo says this has resulted in more a calibrated expansion: "With a much more robust and relaxed environment, you expand rapidly. But with a challenging environment, you continue to expand in a more calibrated scale."

For now, industry players hope that the government can take a step back and evaluate the impact of the policy changes before introducing further measures.