As detailed by Manpower Minister Dr Tan See Leng, the priorities include strengthening support for locals and enhancing retirement adequacy, among others.
Prefacing his speech, Dr Tan briefly reviewed the Ministry of Manpower's (MOM) policies focused on shoring up local employment and keeping foreign workforce policies responsive over the past year.
For example, MOM supported businesses in hiring and investing in the skills of a wider pool of jobseekers, and helped many jobseekers move into new opportunities. Through updated work pass requirements, it also ensured local-foreign complementarity and spurred business transformation.
As a result of these efforts, the median gross monthly income of residents has risen to above pre-COVID level despite a slight dip in 2020. The resident unemployment rate has also come down to 3.2% today, from the previous high of 4.8%.
For the full year 2021, total employment saw an encouraging rebound of 40,800.
Moving forward, Dr Tan shared, MOM aims to provide the necessary support and incentive to restructure Singapore's workforce and build an inclusive and comprehensive labour market, where businesses can access the manpower needed for their growth.
Against this backdrop, MOM’s priorities will focus on three UPs: Upgrade, Uplift, and Uphold.
The first focus is to upgrade the capabilities of locals and the complementarity of foreigners. To do so, MOM will strengthen support for locals so that they are equipped with skill sets to take on jobs of the future. Through foreign workforce policies, businesses will have access to the complementary manpower that they need.
Dr Tan expressed: "For our growth to be sustainable, we must ensure every Singaporean worker benefits from Singapore’s growth and no one is left behind."
Hence, the second focus is to uplift vulnerable workers and mature workers. MOM will implement the recommendations from the Tripartite Work Group on Lower-Wage Workers and double down on efforts to uplift these workers.
Finally, Dr Tan understands that everyone desires a fair opportunity to contribute and to thrive at work. As such, the third focus is to uphold inclusive and progressive practices at the workplace. MOM will continue to support the workforce to meet caregiving needs at home, to support their mental health and wellbeing. It will also continue with efforts to transform the migrant worker ecosystem to improve their physical, social, and mental wellbeing.
Strengthening support for locals
Dr Tan then provided further details on the first focus area — “Upgrade”: strengthening support for locals.
With structural shifts in the economy meaning new growth opportunities for businesses and workers, it is thus important that workers are equipped with the necessary skill sets to thrive in a fast-changing environment.
With reference to Minister Gan's speech, MOM has developed a whole-of-Government Green Economy Strategy (GES) which looks into the jobs and skills that will be transformed and created as a result of the green transition.
Looking more at digitalisation, technology such as artificial intelligence enables the automation of tasks, allowing workers to deliver higher-value work to enhance productivity and improve performance.
Dr Tan avowed: "Helping our businesses to transform and preparing our workers for the future of work have been longstanding priorities for this Government."
Since 2016, MOM has rolled out Industry Transformation Maps, or ITMs, for 23 sectors to chart their transformation journey. As shared in a separate speech by Minister for Trade and Industry Gan Kim Yong, the government is working closely with industry stakeholders, unions, and academia to update the ITMs, to address emerging trends and opportunities.
Even more recently in 2021, it was announced that Jobs Transformation Maps would be launched to map out the impact of technology and digitalisation on individual jobs over the medium term. These provide very detailed, job-level insights to help businesses and workers prepare for future jobs and skills, Dr Tan explained.
To support MOM's scale-up of these programmes, Dr Tan set up the Jobs Taskforce in September last year to derive strategies to increase the placements of local workers into key sectors — i.e., ICT, manufacturing, and financial services.
Dr Tan listed the Career Conversion Programmes (CCPs), as an example. The programmes support employers in reskilling jobseekers and workers for in-demand job roles. They provide targeted support to workers whose job roles might be at greater risk of redundancy.
During the pandemic, the SGUnited Jobs and Skills Package and the Jobs Growth Incentive were also introduced as extraordinary measures to preserve human capital and to expand local hiring.
Together, these initiatives "helped cushion the impact of COVID on the labour market and provided much-needed relief for businesses to meet their manpower needs." More than 174,000 local jobseekers have been placed into jobs and skills opportunities as at end-December 2021.
All in all, a total of S$11bn has been allocated to support these initiatives, Dr Tan shared.
As announced by the Minister for Finance, the Government will continue to provide support for businesses and worker segments such as mature workers. However, moving forward, it will be tailoring support levels in line with the improved economic and labour market situation.
Ultimately, Dr Tan emphasised that support for workers will require a whole-of-society effort and therefore urges all businesses and employees to “help us to help you”.
The support for businesses under the ITMs is complemented by MOM's foreign workforce policies. Dr Tan said: "Foreign workforce policies are key levers to keep Singapore's labour market tight, and incentivise businesses to transform, to move up the value chain and maintain their competitive edge."
On strengthening the complementarity of the foreign workforce, Dr Tan introduced a COMPASS, a new points-based system which assesses candidates and firms based criteria including salary and diversity. Full updates on what it entails, relevant criteria, and more here.
Dr Tan went on to address business concerns. While many business leaders, both local and foreign, support the need to restructure Singapore's workforce to prepare for the opportunities ahead, and move towards a more equitable society, Dr Tan acknowledged that they still share two concerns. The first would be difficulty in finding workers, and secondly, the increase in business costs.
On the difficulty in finding workers, Dr Tan reiterated the schemes put in place to address this, citing that the calibrated re-opening of borders "should ease some pressure." Further, he added, there is still an untapped supply of various segments of Singapore's population, and businesses "can do more to re-design jobs to attract these segments of workers."
On rising business costs, MOM has put in place measures to support businesses. MOM’s support measures will provide up to S$6.8bn to businesses in FY2022. This includes the provision of the Jobs Growth Incentive.
MOM is also rolling out transitional offsets for the increases to senior worker CPF contribution rates, and transitional support for the moves to uplift lower-wage workers.
"The moves are also timed carefully and implemented gradually, to moderate the cost and manpower impact on businesses," Dr Tan stated.
Strengthening retirement adequacy
Finally, Dr Tan shared more on strengthening retirement adequacy. As announced in the Budget Statement, the Government will do so in three ways.
First, the Basic Retirement Sum will be adjusted to provide members with higher monthly payouts to keep pace with long-term inflation and rising standard of living. More members are expected to receive at least the Basic Retirement Sum payout, with about eight in ten active CPF members turning age 55 in 2027 being able to do so, up from 67% for the cohort that turned 55 in 2021.
Second, the next step of the CPF contribution rate increase for senior workers will be implemented.
Finally, the enhanced Workfare Income Supplement Scheme will top up the income of half a million lower-income workers, with payouts amounting to over S$1bn in CPF and in cash, from 2023.
The CPF wage ceiling has been periodically updated since 2003 to keep pace with the wages of resident workers, with the most recent update in 2016.
Dr Tan adds: "We will review the CPF wage ceiling and engage employers and employees ahead of any changes."
These efforts are aimed at helping Singaporeans save more and boost their retirement income. These will however be meaningless if we do not continue to safeguard the savings that Singaporeans set aside for old age. This is why we must carefully assess any calls for more liberal use of members’ CPF monies.
Addressing the suggestions for allowing members with CPF balances beyond the required retirement sum to make lumpsum withdrawals from their CPF savings before age 55, highlighting those who face income disruption, the Government already provides direct and targeted support to these members.
For example, those who face financial hardship during this difficult period have access to an entire suite of support measures, including the COVID-19 recovery grant. Singaporeans also receive support from existing broad-based permanent schemes such as Workfare and ComCare.
It is important to note that all of these do not draw down on Singaporeans’ CPF savings and will not come at the expense of retirement income, Dr Tan stressed.
Dr Tan also addressed the suggestion of members seeking higher investment returns on their CPF monies by expanding the range of financial instruments available under the CPF Investment Scheme, or allowing members to invest alongside government investment vehicles.
In response, Dr Tan stated that higher returns come with higher risks, and a greater potential for losses.
Today, CPF members can already invest in a diverse range of products including exchange-traded funds, shares and gold products. The CPF board welcomes more ETFs to join the CPF investment scheme, however ETF providers’ decisions to apply for inclusion are ultimately based on their own commercial assessment. To safeguard members’ interests, the CPF Board carefully considers factors such as investment-related fees, and track records of the products before approving any such applications.
To ensure that the list continues to remain relevant, the CPF Board will continue to review it on an ongoing basis. This strikes a balance between allowing CPF Investment Scheme participants the flexibility to diversify their investment portfolios to enhance their retirement nest eggs, while safeguarding members’ interests.
The government is also studying if a Lifetime Retirement Investment Scheme can be introduced for members with a risk appetite and sufficient investment on the horizon, but who may not wish to actively manage their investments. Further information and updates will be provided when ready.
Meanwhile, members who prefer not to take any risks with their retirement savings already enjoy interest rates of up to 6% per annum on their CPF savings, where the investment risk is entirely borne by the Government.
Concluding his speech. Dr Tan affirmed that MOM is making many moves to upgrade the capabilities of locals and complementarity of foreigners, uplift vulnerable workers and mature workers, and uphold inclusive and progressive workplaces.
However, he acknowledges that there will always be more work to be done, and as such, will continue relentlessly to put in the hard work of supporting workers and businesses.
"With workers, unions, businesses and Government on the same ship together, I have no doubt that Singapore will continue her voyage into an even brighter future!"
Similarly, in his speech on Friday, Senior Minister of State Koh Poh Koon also spoke on how MOM will continue to support and develop Singapore's local workforce. In a Facebook post, he summarised that "we will extend the Jobs Growth Incentive by another six months, but will concentrate our resources on more vulnerable groups such as mature workers, persons with disabilities and ex-offenders."
Further, to aid mature workers in making career transitions or re-entering employment, the SGUnited Mid-Career Pathways Programme will complement the deeper re-skilling provided by existing Career Conversion Programmes.
Lastly, he mentioned that MOM will also continue working with partners to provide more options for jobseekers.
Image / Screenshot of Dr Tan See Leng's speech, Dr Tan's Facebook