Tuesday, August 16, 2011

Firms slam new moves to restrict foreign talent

Aug 16, 2011
By Aaron Low & Melissa Tan

BUSINESSMAN Yong Choon has branded new moves to tighten eligibility criteria of foreign professionals as 'terrible for business'.

Mr Yong, who chairs electronics manufacturing firm Eubiq and Nutek, which has a few hundred staff on its payroll, said the Government's decision to make an employment pass (EP) harder to get will rattle the corporate sector.

'For businesses there's fear, worry and general inconvenience,' Mr Yong told The Straits Times yesterday.

Some bosses echoed Mr Yong's feelings yesterday, saying the latest round of tightening will likely increase costs and stifle business activity.

Prime Minister Lee Hsien Loong said in his National Day Rally speech on Sunday that the salary and education criteria for EPs for foreign professionals will be raised again, clearly a move to help boost employment prospects among white-collar Singaporeans.

EP rules were amended just last month. Then, monthly salary levels were raised for three types of EP: Q1, P2 and P1. The new levels are $2,800 for Q1, up from $2,500; $4,000 for P2, up from $3,500, and $8,000 for P1, up from $7,000.

Details of the latest round of measures to raise both the salary and educational criteria are expected to be released by the Ministry of Manpower soon.

Mr Allan Lim, chief executive of Alpha Biofuels, said foreign workers help lower business costs.

'I think you have to take a calibrated approach,' said Mr Lim, who has two foreigners on the S-Pass, of his dozen or so staff.

'There will always be pockets of work Singaporeans may not want to do, and overpaying a Singaporean to do that work would be inefficient.'

Mr Gan Chin Yean, managing director of precision engineering firm Interplex Singapore, said that if his firm cannot get the talent it needs for its business, it will simply move the work to Malaysia.

'We usually take engineers at a lower level, who are maybe on S-Pass, and train them up, as we need people with specific skills,' he said.

He added that once he trains these engineers, they are paid more and may become EP holders, so if the criteria are tightened, he may end up losing these skilled workers.

Mr Ian Lee, human resource manager of a local IT firm, said raising the salary criteria may mean having to pay Singaporeans more and add to wage costs.

'If I have to pay more to foreigners to keep up with the salary requirements of their pass, the locals may also ask for more, which just adds to costs,' he said.

Mr David Leong, managing director of regional human resource firm People Worldwide Consulting, said he worries that continuing to raise the EP bar could mean Singapore will lose out in the race for foreign talent.

He noted that it is increasingly difficult to attract foreign talent from places like China and India as working conditions and salaries there are improving.

'China's economy is evolving and many workers there want a piece of the fast-growing economy back home,' he said.

'Singapore may end up jammed with a policy mechanism that makes it hard for firms to attract the workers they urgently need.'

[In a sense this is a preview of what would happen with a minimum wage programme for low income. As costs goes up, businesses will close or move out. And those that have jobs will lose them.]

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