Shortages of skilled labor and labor constraints could hit Singapore's manufacturing sector

Singapore – Singapore has attracted high-tech manufacturers with incentives and a well-trained workforce, but the growing demand for highly skilled labor and the measures taken by the government to reduce the number of workers foreigners could mean a more difficult route.

The city-state is a major producer of products ranging from aircraft engines to medical equipment to oil rigs. Leading companies such as Rolls-Royce and the German industrial conglomerate Siemens are present.

The British pioneer of home appliances, Dyson, will open its first electric car factory in the city. Vehicles should leave the production line from 2021. In 2019, they announced their intention to transfer their global headquarters to Singapore.

But a potential shortage of more specialized skills as companies turn to areas such as robotics and 3D printing, as well as measures to make it harder to hire foreigners in this country in lack of space, can make less attractive the opportunity to settle in Singapore. in the future.

Authorities work closely with businesses to help them locate and find workers, while providing incentives such as tax breaks, but the rapid pace of technological change in many sectors makes planning more difficult for the government .

"Ten years ago, decision makers could plan with greater certainty," said Song Seng Wun, regional economist at CIMB Private Banking. "The era of disruptive technology creates a lot more uncertainty."

In a recent report, the Department of Labor stated that one in three positions in 2018 had been left vacant for at least six months and that employers had cited the "lack of the specialized skills needed ".

Limitations of the foreign labor force

Singapore has traditionally hosted foreign workers in sectors ranging from construction to investment banking, to address skill shortages and jobs that are beyond the reach of the local population. 40% of its 5.6 million inhabitants are foreigners.

But in recent years, the number of strangers in the city, two times smaller than Los Angeles, has spurred growing discomfort, with locals accusing them of overcrowding and increasing the cost of living.

The government has responded by making hiring more difficult in some sectors and giving companies priority for local recruitment. This includes initiatives such as the acceptance of applications by some Singaporeans for some of the most qualified jobs, for a specified period of time before they are open to foreigners.

At a forum on labor issues in Singapore, participants lamented that "some policies such as increased levies on foreign workers and general quotas of foreign workers have apparently limited the growth of many foreign workers. companies, "wrote Mooris Tjioe of Singapore's Institute of Policy Studies.