Minister of Manpower, Lim Swee Say cautioned local labour workforce on the prospect of rising unemployment in the country and if employers do not address the job-skills mismatch issue promptly and strive for quality economic growth.
Considering low jobs growth will continue to persist in Singapore, Lim reiterated a dire warning that the local labour force could stagnate in a decade or so. With the number of locals seeking work, outstripping the number of jobs added by multifolds last year, Lim stressed on the need to maximise connectivity between job seekers and opportunities.
Last year, 37,000 more Singaporeans and permanent residents left the workforce compared to the annual average in the previous three years, even as the number who entered it fell by about 36,000. Responding to a slew of questions tabled by Members of Parliament (MPs) on the job situation, Lim was quoted by Today Online saying, “This is a swing of 73,000, and this has resulted in the flat growth in our local employment growth of only 700.”
He further added: “With our local workforce growing slower, it does not mean we can afford to go slower, too, in our efforts to create jobs. I will use 2015 as an illustration. Even though local employment went up by only 700, the number of locals looking for jobs was many times higher. We must not forget that there were 190,000 new entries of young locals and re-entries of mature locals in that year.”
“More importantly, the number of people retiring is also on the rise, doubling over the last two years. This will continue as more baby boomers enter retirement.”
Shedding light on the measures taken by the Ministry of Manpower to address the increase in unemployment rate and the fall in the rate of re-entry into employment, as well as the outlook of the job market for the next 12 months, Lim said, “In the first half of this year, the figure went down by 200, resulting in a net increase of “just 500 over 18 months. Fortunately, while the unemployment rate increased, it did not rise sharply. I was puzzled. Why didn’t the sharp drop in local employment growth lead to a sharp rise in unemployment?”
This trend of slowdown in local workforce growth could have major implications towards negligible levels or even stagnation by 2020. It is important for Singapore to ensure that the current low economic growth of 1 to 2 percent is transitional, and we continue to thrive towards quality growth of 2 to 3 percent.
With several industries undergoing transformation to achieve higher productivity gains, he added that the Government was adopting a balanced approach towards managing the inflow of foreign manpower. The annual increase in foreign manpower has dropped significantly from the peak of 80,000 in 2011 to about 24,000 in each of these past two years.
Since October 2015, Employment Pass applications from companies are being closely scrutinised on their ratio of locals to foreigners compared with the rest of the industry, their commitment to developing locals and economic-social impact on Singapore.