Singapore sees skilled job creation sliding in 2014 as labor restrictions bite

Credit: Reuters/Edgar Su

Office workers take a cigarette break in the morning light at the central business district area in Singapore October 28, 2013.

Singapore expects to create 14,000 to 16,000 new skilled jobs in 2014, down from 21,400 in 2013, its Economic Development Board (EDB) said on Tuesday.

The government has put into place a number of schemes aimed at improving productivity of Singaporean workers and reducing the country's reliance on foreign labor, whose presence increasingly riles its citizens.

New rules that will require companies to consider Singaporeans for skilled vacancies before turning to candidates from abroad will kick in this August.

'Quite clearly, companies have to adjust to the changing manpower landscape in Singapore,' EDB Chairman Leo Yip said.

'For some of them, it means changing the way they do their work in Singapore. For example, how robotics and technology can be used and the manpower can be deployed to do other things.'

The city-state saw its productivity grow by 0.2 and 1.6 percent in the second and third quarters of 2013, marking the first time it grew for two quarters since 2012, after six quarters of contraction.

According to Yip, the EDB has not seen any loss in investment projects due to the tightening labor market and regulations.

'They have not, as a factor, swung their business decisions,' Yip said. 'No company has told us, 'look, we don't want to come to Singapore anymore because your manpower situation has made you less attractive than before'.'

Nonetheless, Yip said companies have come forward to ask the EDB to 'train Singaporeans to develop the capability' that firms need, while assuring the EDB that they still choose Singapore as their investment destination.

INVESTMENT DECLINE

Fixed-asset investment (FAI) in Singapore fell 24 percent to S$12.1 billion ($9.59 billion) in 2013 from S$16 billion in 2012, with the electronics and chemicals sectors showing marked declines, figures from the EDB showed.

'If you look at the trend over the last 5-10 years, you see that S$12 billion is actually well within the range that we have secured. There were several spikes (including 2012), and those spikes were big investments,' Yip said.

While electronics still accounted for 27 percent of total FAI last year, investment in the sector dropped by 46.8 percent to S$3.3 billion.

FAI in the chemicals sector dropped 62.7 percent to S$2.5 billion.

'The semiconductor industry is in the phase where most companies tell us they are not certain that the recovery is clearly on the strong track,' EDB Managing Director Yeoh Keat Chuan said.

'They're holding on from making major green field investment. So what they do is incremental expansion in order to be able to tweak and expand their existing capacity,' Yeoh said.

($1 = 1.2757 Singapore dollars)

(Editing by Rachel Armstrong & Kim Coghill)