Singapore 2015 budget is finally announced and many employers would be rummaging through whatever details they can find to understand how it would affect their businesses.
With the labour crunch a common complaint among employers of every category, this is one key concern that many was hoping to get some breathing space on.
Alas that didn’t really happen.
But there are many other aspects that employers would need to take heed of as the impact individually or collectively might create a major impact on how you hire in the future.
- Increase payroll cost but offset (partially) for next two years – The rise in CPF contribution rate might affect employers that have a higher weightage of workers that falls under the affected bracket. Fortunately there is the enhancement to the Temporary Employment Credit (TEC) and Special Employment Credit (SEC) that would provide some respite to the increment.
- Deferment of further Foreign Workers Levey (for now) – For employers that are heavy on this, you would be pleased to knoe that the Government has deferred and rebalanced foreign worker levy rates across various sectors. This is to allow more time for businesses to adjust and restructure, taking into account factors such as the moderation in foreign workforce growth.
- Continued incentive to give increment to workers – Wage Credit Scheme will continue into 2017. Gross monthly wage increases of at least $50 in the qualifying year (2016-2017), up to a gross monthly wage level of $4,000, will qualify for 20% co-funding. In addition, gross monthly wage increases of at least $50 given in 2015 and sustained in 2016/2017, and wage increases given in 2016 and sustained in 2017, will continue to be co-funded at 20%.
- UpSkilling our existing workers – Given our lackluster productivity figures, a different take is needed to course correct. In addition to targeting businesses and encouraging them to send workers for training, the SkillsFuture initiative targets the individuals. This mean your workers will be able to choose what they want to learn instead of what they are told.
- Preparing the school leavers – with SkillsFuture Earn and Learn Programme. Fresh Polytechnic and ITE graduates will be placed in jobs and receive a salary while undergoing institution-based and structured on-the-job training that leads to an industry-recognised qualification. Both trainees and employers will receive substantial support from the Government.
- Preparing new local leaders – Beside Study Awards and Fellowships, there is also a Leadership Development Initiative to develop a pipeline of Singaporeans to take on corporate leadership roles and responsibilities. The final bit is really interesting as we equip locals to take on key leadership roles. I always feel that it make more sense to have a local lead a local company, given the culture and a higher sense of accountability.
- And preparing for the next phase of workers to be more relevant – To uplift the broad base of companies, and to help Singaporeans develop their careers across our economy, the Government will work with employers, unions, and education and training providers to develop and implement Sectoral Manpower Plans (SMPs) in all key sectors by 2020. To help SMEs overcome the constraints they face in developing capabilities and capacity, the Government will also work with industry partners to develop a shared pool of SkillsFuture Mentors with specialized, industry-relevant skills, which SMEs can tap on.
As always the devil is in the details. Just look at National Jobs Bank. Let’s await further announcement by MOM over the Committee of Supply.