Singapore Budget 2019 may focus on helping vulnerable labor force: DBS
A report by DBS Bank reveals that the Singapore Budget 2019 may focus on helping the ‘exceptionally vulnerable’ labor force segment – professionals, managers, executives, and technicians (PMETs).
The report “Singapore Budget 2019 – Helping the ‘newly vulnerable’” says, for the past nine years, the percentage share of PMETs among all retrenched workers has been rising. The situation is more acute for resident (Singaporeans and PRs) PMETs. “The percentage share of resident PMETs amongst total retrenched residents is as high as 70% in 3Q18. This is far more than the share of resident PMETs (56%) in the total resident employment,” says Irvin Seah, the Executive Director at DBS Bank.
Additionally, degree holders account for the largest segment (43%) amongst those who were retrenched in that quarter. This may suggest that this segment of the labor force is increasingly facing more difficulties in maintaining their employability.
Beyond accounting for a relatively higher percentage of the retrenched workers, resident PMETs also “face relatively greater difficulties getting back into the workforce”. The re-entry rate for PMETs and degree holders have persistently been much lower than the other segments of the workforce and the national average.
The need for more policy support
“Given the rising vulnerability of the PMETs, we expect more forceful policy measures to tackle this emerging concern in the upcoming budget. Expect further enhancement to schemes such as the Professional Conversion Program (PCP) and the Adapt and Grow initiative,” says Irvin.
Beside enhancing some of the existing schemes targeted at the PMETs, there could be a review on existing guidelines pertaining to skilled foreign workers.
Irvin also says, “Singapore’s population will start to shrink from 2025 onwards. With low birth rates, longer life expectancy due to better medical care, Singapore’s old age dependency ratio is set to rise. This implies a higher financial burden and healthcare cost for Singaporeans and the government going forward.” Beside subsidies and insurance coverage, there could even be a need to introduce a health-related tax (e.g., Sugar Tax) to encourage public health consciousness.
Preparing Singaporeans for the future
Policymakers will continue to focus on preparing Singaporeans for the future, says Irvin, beyond helping the PMETs and mitigating against challenges such as rising healthcare costs. For example, disruptive technologies could potentially make many jobs redundant.
Hence, “there is a need to continue to invest in education and skills upgrading. Periodic reviews and updates are also crucial to ensure relevance of the existing education and training schemes,” adds Irvin.