Singapore's Slowing Economy and Drop in Employment Causes of Concern in Parliament

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Here are some of the parliament questions that were filed in the last Parliament sitting (Note: we report the parliamentary Q&As as is as opposed to the MSM's abridged versions to help give you, our readers, a clearer idea on what is being done in the house in your name.)
 
On what kind of impact the slowing economy has had on the country's employment rate and what is the government doing to help displaced workers.
 
Filed by Mr. Patrick Tay Teck Guan: To ask the Minister for Manpower in light of the Q2 2016 Labour Market report wherein it is indicated that there is a rise in the unemployment rate, a lower rate of re-entry and the number of unemployed persons has now outnumbered job vacancies, what is Ministry doing to (i) overcome these three trends including youth unemployment (ii) help the unemployed especially the vulnerable who have a lower re-entry rate and (iii) minimise the skills/jobs/expectations mismatches that have contributed to the unemployment.
 
Filed by Mr. Melvin Yong Yik Chye: To ask the Minister for Manpower (a) why the rate of employment among locals has remained stagnant over the past 18 months despite the tightening on foreign manpower supply; and (b) what is being done to address and overcome this trend.
 
Filed by Mr. Desmond Choo: To ask the Minister for Manpower with the number of redundancies and retrenchment cases reaching record levels in the first half of 2016, how will the Ministry (i) help affected workers especially the PMETs who are the most affected (ii) assist lower-wage workers to find alternative employment quickly and (iii) prepare our workers for new jobs in industries facing poor economic prospects.
 
Filed by Mr. Liang Eng Hwa: To ask the Minister for Manpower (a) whether there will be a further rise in job losses in the next 12 months; (b) what are the sectors that are likely to be more impacted; and (c) whether is there a need to tighten up Employment Passes and S-Passes as more local PMETs become available due to increasing job losses and slower job growth
 
Filed by Ms. Foo Mee Har: To ask the Minister for Manpower whether the Government will review the Employment Pass scheme in light of increasing redundancies affecting PMEs.
 
Filed by Mr. Ang Hin Kee: To ask the Minister for Manpower (a) whether there will be enhanced efforts by the various job placement agencies to assist with job matching services for local workers who are retrenched or jobseekers who have been unsuccessful in their job search efforts; (b) what is the Ministry's assessment of employers' readiness level in supporting these efforts; and (c) what can employers do to make job vacancies and requirements be made known to jobseekers beyond listing on the national Jobs Bank.
 
Filed by Melvin Yong Yik Chye: To ask the Minister for Manpower (a) whether the Ministry has any plans to better help retrenched local workers, particularly PMETs, in
 
their job searching process; and (b) whether the list of Professional Conversion Programmes can be expanded to cover more industries and sectors so that PMETs can have more career options.
 
Filed by Mr. Christopher De Souza: To ask the Minister for Manpower what programmes and initiatives have been created to assist Singaporeans to secure employment and to encourage companies and employers to create new job vocations and opportunities in the present economic climate.
 
Filed by Associate Prof Daniel Goh Pei Siong: To ask the Minister for Manpower (a) to date this year, how many PMETs under 40 years of age have been made redundant; (b) what is the rationale to restrict the Career Support Programme for PMETs to those who have been unemployed for six months or more; and (c) whether this restriction to access the programme should be removed for the PMETs.
 
Filed by Dr. Tan Wu Meng: To ask the Minister for Manpower whether the Ministry will consider upgrading the national Jobs Bank to a national Jobs Registry by (i) making it mandatory for employers to advertise all job openings in parallel within the national Jobs Bank even if the job opening has been advertised through other platforms and (ii) requiring employers to report hiring outcomes to the Ministry.
 
Filed by Ms. Jessica Tan Soon Neo: To ask the Minister for Manpower what measures are in place to help displaced workers with new job opportunities and to create more quality jobs.
 
Filed by Mr. Ang Wei Neng: To ask the Minister for Manpower how are e2i and other relevant job matching agencies beefing up their effort to help Singaporeans find suitable jobs especially those affected by job redundancy.
 
Answer
 
Madam Speaker, these 12 questions cover three broad areas: Major developments in our labour market, Employment support for our workers, and Regulation of foreign manpower supply.
 
On the ground, there is much concern that local employment growth has been flat. It went up by 700 last year, and came down by 200 in the first half of this year, giving a net increase of just 500 over 18 months. I am concerned too.
 
Fortunately, while unemployment rate increased, it did not rise sharply. It exceeded the range of 2.6% - 2.9% registered in the past 5 years, marginally, to reach 3.0% in June 2016.
 
I was puzzled. Why didn’t the sharp drop in local employment growth lead to a sharp rise in unemployment? With the help of my colleagues at MOM, I soon discovered that the
 
main reason for the flat growth in local employment was a slowdown in local workforce growth. Let me share what I learnt with this House.
 
In the 3 years from 2012 to 2014, an average of 226,000 locals joined, and 153,000 left employment each year, giving an average net increase of 73,000, or 79,000 if we include the self-employed.
 
But in 2015, the number of locals entering dropped significantly by about 36,000, while the number leaving increased by about 37,000. This is a swing of 73,000, and this has resulted in the flat growth in our local employment.
 
This swing was partly cyclical. We saw that more people left employment after termination, and completion of contract and casual employment. More also left to pursue further studies and upgrading.
 
But the swing was also structural, across all age groups. For those aged 25-64, our labour force participation rate of 83.1% is high and showing signs of plateauing. For the younger ones aged 15-24, the size of the cohort entering the labour force had already peaked in 2013 and started to decline since then. More importantly, the number of people retiring is also on the rise, doubling over the last 2 years. This will continue as more baby boomers enter retirement.
 
In short, even though the numbers of exits and entries in our local workforce will fluctuate from year to year due to prevailing economic conditions and policy factors. But with ageing and lower birth rates, coupled with our relatively high labour force participation rate and low unemployment rate, we will see a continued slowdown of local labour force growth, towards negligible levels, or even stagnation by the mid-2020s.
 
This has three major implications.
 
First, we must work our way towards more healthy economic growth.
 
Even though flat local employment growth in the past 18 months did not lead to a sharp rise in unemployment rate or a sharp drop in labour force participation rate, we are concerned that this could still happen if the global economic situation does not improve, or worsens further.
 
We must make sure that the current low growth of 1%-2% is only transitional, and not the future norm. Our future norm should be 2%-3% of quality growth, not 1%-2% of low growth.
 
This is because our ultimate objective in pursuing growth is not growth itself, but to create jobs in sufficient quantity, and with good enough quality for our people to have better jobs, wages and careers.
 
Madam, 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.
 
Many of them were not just looking for the same jobs vacated by those who have left employment. With better education and skills profile, they wanted better jobs to meet their higher expectations and aspirations. The same applies to those who were already in the workforce.
 
This is also why we can never slow down. To move faster, we have mobilised industry leaders, unions and economic agencies to create and re-create many more quality jobs in more than 20 major sectors. We have to make sure that the innovative growth of our economy will also be an inclusive growth for all our people.
 
Second, our policy on foreign manpower must be well balanced.
 
At one extreme, if we try to make up for the drop in local labour growth by taking in many more foreign workers, the pace of our restructuring will slow. We will become overly reliant on foreign manpower, and our wages will also stagnate without sustained productivity growth.
 
At the other extreme, if we reduce the growth of foreign manpower to zero, [0 (local labour growth) + 0 (foreign manpower growth) = 0 (total workforce growth)] our total labour force will eventually stagnate. And if labour productivity growth continues to remain at the current low level, (0+0+0=0) our economy will eventually stagnate too. We cannot allow this to happen.
 
This is why we are transforming industries for higher productivity gains, and are adopting a balanced approach in managing the inflow of foreign manpower.
 
The annual increase in foreign manpower has dropped, significantly by more than 2/3 from the last peak of 80,000 in 2011 to about 24,000 in the past two years. We are increasingly more selective in terms of qualifications and experience of the individual foreigners.
 
More importantly, to ensure that our people are treated fairly at all levels in all industries we have included the adoption of fair and progressive HR practices as part of our work pass criteria.
 
This balanced approach will enable our combined workforce of locals and foreigners to complement each other better and compete aggressively for good investments globally, such as the opening of Micron’s expanded facility here last month.
 
We need to compete and win many more of such good investments, so that we can keep creating better quality growth for the economy and better quality jobs for our people.
 
Third, we must minimise job-skill mismatches and maximise the connectivity between job opportunities and jobseekers.
 
We share the concern that we could see a higher number of layoffs than before, especially in sectors facing weak demand. We must stand by our people and do more together to support them in this period of economic transition – training support, wage support, job search and career conversion.
 
We have stepped up job matching and career services with the introduction of the Adapt and Grow initiative.
 
In the first 8 months of this year, Workforce Singapore and e2i assisted 20,000 active jobseekers. More than 13,000 found jobs in various sectors including Infocomm Technology, Healthcare, Early Childhood Care and Education, Professional Services, Admin and Support, Biologics Manufacturing, Transport and Logistics.
 
The number of successful job placements is some 20% than the same period last year. They comprise both PMETs (45%) and rank-and-file (55%), including low-wage workers. They also come from all age groups – 35% (1 in 3) below 40, 25% (1 in 4) between 40 and 49, and 40% (2 in 5) age 50 and above.
 
We are doing more for the rank-and-file. We stepped up reskilling and job matching. We also created more work trial opportunities for our workers to try out jobs which they are not familiar or comfortable with.
 
We are also doing more for the PMETs. We rolled out 24 new Professional Conversion Programmes (PCPs) this year in 14 sectors, such as International Trade and Cybersecurity. We started the year with 22 PCPs. By the end of the year, we will have more than 50 PCPs to help many more PMETs to convert to professions and industries with growth potential.
 
We also provided extra support for mid-career PMETs aged 40 and above who are unemployed for more than 6 months. The Career Support Programme (CSP) was introduced a year ago to help them with wage support.
 
We are seeing a higher share of PMETs among residents made redundant (71%). We have therefore extended the CSP since May this year to two additional groups of PMETs: All PMETs made redundant who are aged 40 and above, even if they have been unemployed for less than 6 months; And all PMETs made redundant and unable to find jobs after 6 months, even if they are below 40.
 
Madam, jobs is the best welfare and full employment is the best protection for our people and our workers.
 
Our efforts in industry transformation will lead to better jobs and careers. Our efforts through SkillsFuture will lead to better workers with deeper and newer skills. And with Adapt & Grow, we will connect them better to each other – Better jobs to better workers, Better workers to better jobs.
 
The National Jobs Bank has been useful in helping our local jobseekers gain access to more jobs, especially PMET jobs. Today, about 180,000 registered users are gaining access to the Jobs Bank. And about 25,700 employers that registered with the Jobs Bank and the advertised jobs, on a daily basis, there were 60,000 active jobs on our Jobs Bank for workers. And every day, we receive 7,000 job applications. In response to Mr Tan Wu Meng, we do not intend to make it compulsory at 83 for all companies to post all job vacancies on the Jobs Bank and at the same time to report all hiring outcomes to MOM as suggested.
 
Instead, we will transform the National Jobs Bank into a one-stop and non-stop online marketplace. It will bring together employers, regardless of whether their jobs are in the Jobs Bank, to connect them to active and passive jobseekers, regardless of their age. Jobseekers will be able to explore new career opportunities and conduct job searches anytime, anywhere without having to wait for the next job fair. They can be young adults looking for their first jobs, mid-careers looking for their next careers, or mature workers looking to remain active.
 
For those who need advice on what jobs and careers to pursue, whether they are current jobseekers or future jobseekers such as vulnerable workers in industries facing poor prospects, we will leverage the Skills Framework to help them more and serve them better.
 
With the Skills Framework, jobseekers can clearly see what are the career paths, occupations, skills requirements and training programmes available to them in every major sector. The Skills Frameworks for Hotel and Accommodation Services, and Early Childhood Care & Education have already been launched. More sectors will follow soon.
 
Madam, in conclusion, as we enter the next stage towards 2% to 3% of quality growth I assure our fellow Singaporeans that the tripartite partners are doing our best for them, at the national level, and the sectoral level.
 
We need our businesses to do their part, to transform and grow. And we need our people to do their part too, to adapt and grow.
 
Last time round during the global financial crisis, we cut costs together, we saved jobs together, and upturned the downturn together. This time round, our challenge is: Transform together, Adapt together, And grow together. Working together, we can succeed once again.

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