Lim Swee Say: Two-thirds Singaporean core in workforce a firm target

Move not reaction to past mistakes, but reflection that realities have changed: Manpower Minister
By Loh Chee Kong, TODAY, 21 Aug 2015

The Government will hold fast to its goal of having a two-thirds Singaporean core in the economy, and this will be the structure of the country’s workforce in the “medium to long term”, Manpower Minister Lim Swee Say said.



Speaking to TODAY in an interview earlier this week, Mr Lim elaborated on the Government’s aim — which he mentioned in a Parliament sitting last month — of maintaining the 2:1 ratio of Singaporean workers to foreign employees.

“We are managing the growth of the foreign manpower at the pace in tandem with the growth of the local manpower,” said Mr Lim. “It’s important that we ensure that two thirds of our workforce will form a strong Singaporean core in our economy ... On the whole, we want to do our best to strike this balance.”

The move would not diminish Singapore’s standing as a global city and if a balance is struck, foreign investors would still find the country a good bet, he said. In fact, the Republic’s position as a talent hub would be enhanced, with leading multinational companies trying to ”take advantage of every headcount possible” to bring in the most qualified and experienced person, he said.

During the hour-long interview, Mr Lim also reiterated that the tightening of the Republic’s foreign manpower regime was not a reaction to past mistakes, but was rather a reflection that realities had changed. The inflow of foreign manpower was a hot topic during the 2011 General Election, and Mr Lim identified the “determination to manage” the growth of the foreign workforce here as the key shift in manpower policy since.

He stressed that it was “quite clear” that Singapore’s previous growth strategy had reached a point whereby it was “no longer sustainable — not necessarily immediately, but in the medium to long term”. “It’s not so much because the policy of the past was a mistake but rather, we are now having a new stage of growth and therefore we have to pursue a new direction,” he said.

Mr Lim pointed out that all global cities have restrictions on imported labour. “Not everybody from all over the world can just go to New York or London, take up a job and settle down. Management of foreign manpower in many global cities of the world, in fact, is a norm. So Singapore is no different from anybody else,” he added.

Nevertheless, he noted that some cities are very open to foreign manpower. However, in these places, locals go back to their homes in the countryside — a luxury that Singapore, as a city-state, does not have.

He added: “Every country has to find the right balance … But on the whole, I would say that we have managed the process a lot more effectively compared to some other cities and countries. Through the manpower quota system, we have ensured foreign manpower spread across all sectors and companies.”

In his interaction with representatives from multinational companies here, he noted that many of them recognised “that one reason why they are here is that they can tap on local talent”. “They do not see that this policy direction ... would limit their access to foreign manpower,” Mr Lim said.

He pointed out that having foreigners make up a third of the workforce would offer companies “tremendous scope” to bring in global talent. “One third is not a small percentage. In fact, in many countries, they are looking at much lower than one third,” he said.

Singapore is now more selective of the types of foreign workers it wants, Mr Lim said. For the rank and file workers, it would prefer those who are more skilful and more experienced. “We don’t want Singapore to be their learning ground,” he said.

For PMETs (professionals, managers, executives and technicians), the Republic is looking for those “who can bring the expertise and know-how to complement and supplement what we have in Singapore”, Mr Lim said.

In short, the emphasis is on quality over quantity — quality in terms of the foreigners’ relevance to Singapore’s future direction, Mr Lim explained. “Ideally, (a situation where) local and foreign PMEs are not competing for jobs in Singapore (but one where) Singaporean PMEs are working together with foreign PMEs to help us to compete for jobs with the rest of the world.”

Economy at critical juncture: Swee Say
By Loh Chee Kong, TODAY, 21 Aug 2015

The issues of foreign manpower and productivity may hog the headlines, but the Republic faces more critical challenges as growth moderates and it approaches a fork in the road.

One turn leads it towards being an economy that depends less on manpower, creates better jobs and ensures a healthy pipeline of Singaporeans able to form the core in all the major sectors.

The other is a path taken by other developed economies, which has led to a shortage of jobs, wage stagnation and youth unemployment.

In an interview with TODAY earlier this week, Manpower Minister Lim Swee Say said he is confident that Singapore will take the former route, as the Government, unions and employers are sparing no efforts towards achieving this end.

But, he cautioned, nothing is pre-ordained, and the stakes are high. “If we do it wrong, all the problems faced by the developed economies today will come to us,” Mr Lim said.

Singapore had arrived at a similar economic crossroads in the past, he said, and made the right choice by pursuing a high growth model dependent on a large supply of foreign labour.

This, said Mr Lim, “served the interest of our local workers very well ... that was the period in which the world was having a shortage of jobs. But in Singapore, because of our high growth policy, we had a shortage of workers”.

He added: “(There was also) wage stagnation around the world, but we saw wages grow in real terms here. The world has increasingly been bogged down not just by unemployment, but more severely, youth unemployment — you see that all over the world. Yet in Singapore, we managed to escape all that … I would say it’s mainly due to our healthy economic growth, which was in a way reinforced by higher manpower growth through the increase in foreign manpower.”

But he stressed that the old model was unsustainable — both on the social and economic fronts, as congestion and other social problems have come to the fore, and productivity is languishing. “There is no easy way out ... We can’t have the best of all worlds,” he said.

Over the years, the Government has put in place a slew of initiatives to ease the transition. In Mr Lim’s eyes, none are more significant than the SkillsFuture movement and the push to create “jobs of the future”. Strong tripartism, he stressed, will be the bulwark against the problems dogging developed economies around the world.

“In Singapore, we do not intend to get it wrong,” said Mr Lim, who headed the labour movement for eight years before taking on his current portfolio. “The tripartite partners are working very closely together to make sure that we get it right.”

On Wednesday (Aug 19), the Ministry of Manpower (MOM) announced a two-year pilot that gives small and medium enterprises more leeway in hiring and retaining foreign workers — provided they commit to becoming more manpower-lean, developing their workers, and building a stronger Singaporean core eventually.

But companies must do their part, and learn from others, including foreign ones, in order to move the transformation along, particularly in upgrading the manufacturing, services and construction sectors. Working groups in the various sectors have been set up to “learn from the best” in looking at ways to transform the way things are being done, he added.

Finding new ways to grow, Mr Lim said, was essential. “In the past, a very straightforward way to grow is to hire more workers. Do more of the same,” he said. “(Now) they have to learn how to make better use of technology, equip workers with better skills, find ways to redefine engagement with customers.”

Mr Lim said the Government recognised that the transformation of the economy is a process that will not occur overnight. “Our priority will be to help the pioneers and the early adopters to succeed. If the pioneers do not succeed in the transformation, the early adopters will not come along … the laggards are the ones we are going to be least concerned about because at the end of the day, the market forces will determine who will get there, who will not.”

For the MOM, its areas of priorities are to transform the economy to become more manpower lean, maintain the overall ratio of Singaporean workers to foreign employees at 2:1, and to raise the quality of foreigners who arrive here to work. The goal is creating a “future ready” Singapore, Mr Lim said.

In terms of strengthening the Singaporean core, the Government has introduced numerous measures including the Fair Consideration Framework, the national jobs bank, professional conversion programmes and the SkillsFuture movement.

From October, companies will need to publish the salary range offered for job vacancies placed on the Jobs Bank, or have their subsequent applications for Employment Passes rejected.

To enhance the quality of foreign PMEs (professionals, managers and executives), the ministry also announced earlier that it would reject applicants with “doubtful” qualifications, such as those from degree mills.

Mr Lim said that unless Singapore can get the best of its manpower, this would become the key bottleneck of growth in the future. “Between now and 2020, our workforce is not going to shrink. Our immediate challenge is that over the next three years or so, we should really focus our energy … to make this transition (to a manpower-lean economy) together,” he said.

Beyond that, workforce growth would slow but not necessarily stagnate or shrink, he said. “There are other factors at play, for example, marriage and procreation. I would say that as Singaporeans, we should not just surrender, put our hands up and say, ‘Look, there’s no way we can up our birthrate, therefore, let’s accept that eventually, our workforce will shrink, our population will shrink’,” Mr Lim added.

More ‘must be done’ to manage, develop workers
By Loh Chee Kong, TODAY, 21 Aug 2015

Human capital must be developed in tandem with restructuring: Lim Swee Say

For the longest time, organisations here have, by and large, not given enough attention to managing and developing their people.

But this has to change as Singapore moves towards a manpower-lean economy where human resources (HR) become the most valuable capital, said Manpower Minister Lim Swee Say.

To that end, the Ministry of Manpower, the Singapore Human Resources Institute and SPRING Singapore are coming together to establish a professional framework for HR management here, Mr Lim said in an interview with TODAY earlier this week.

Last month, SPRING launched the Human Capital Movement to help small and medium enterprises (SMEs) attract and retain talent.

Under the initiative, SPRING would build a community of advocates who will share with SMEs the best HR practices and facilitate peer-learning activities.

It would also provide SMEs access to HR expertise through the appointment of a pool of volunteer HR directors. An HR diagnostic tool has also been developed for these companies.

“What is important is to ensure that our HR community can also be prepared for the future,” Mr Lim said.

Tracing the development of Singapore over the decades, Mr Lim noted how the Republic’s economy had started off by being labour-intensive, where sheer numbers were the most important.

The next stage was a capital-intensive one that saw companies bring in equipment and machinery.

Then, in the 1980s, the buzzwords were “office automation” and “computer-integrated manufacturing”.

“I would say that in the future, as we move towards becoming a manpower-lean economy, human capital will become the most important asset of the economy,” Mr Lim said.

“In other words, how we are able to bring the best out of everyone, and in a way, that will also give them the best in return for giving their best. I would say that that becomes a key factor for us to build on.”

Mr Lim stressed that it would be critical for the development of human capital to be in tandem with economic restructuring. If one moves faster than the other, the outcome would not be optimal.

“If the economy runs faster than the development of our human capital, we end up having structural mismatch, and things won’t work,” he said.

“On the other hand, if the development of human capital runs much ahead of the restructuring of our economy, we are going to have Singaporeans (who are) well trained, well qualified, well equipped, but they cannot find the kind of quality jobs, quality careers in Singapore. They will go elsewhere.”

Having said that, Mr Lim noted that it is not necessarily a bad thing for Singaporeans to venture overseas at some point in their careers as part of their development towards becoming what he called “global-oriented PMEs (professionals, managers and executives)”.

To ensure that the two moving parts are in sync, industry leaders are setting the pace under the sectoral manpower plans that are being drawn up as part of the nationwide SkillsFuture initiative.

Mr Lim is under no illusions about the size of the tasks ahead.

“The world is changing so fast. The competition is running so fast … we need to run as fast as we can on both fronts.

“And yet, at the same time, knowing that if the two (developing human capital and restructuring the economy) are not harmonised, we are going to create the kind of outcomes that are not what we strive for.”

This is why, he said, the alignment of people’s mindsets and efforts by industry and the Government is crucial to ensure that the country moves ahead together.

There are reasons for optimism, Mr Lim said. Already, the alignment of the twin thrusts is “a lot stronger” in Singapore compared with other countries.

“That gives me the confidence that we stand a much better chance than anybody else of arriving at this future (that Singapore is working towards),” he said.