Perhaps, Singapore is the first in the region, when it comes to microeconomic management. The global pandemic manifested not only the resilient of the Singaporean economy, but also its ability to manage it well, prioritising and targeting incentives on specific sectors that would bring about immediate results.
The Singaporean government’s Jobs Growth Incentive (JGI) is such an initiative that has already helped 27,000 firms to hire 130,000 local workers over three months according to the Ministry of Manpower (MOM) in its latest Jobs Situation Report.
Substantial job gains
The wage subsidy scheme not only enables, but also encourages the companies to hire more Singaporeans and permanent residents despite stress brought about by the global pandemic and subsequent economic contraction.
The scheme was first launched in August last year and was to last for five months. However, it was given an additional S$5.2 billion in the Budget 2021, extending it until September.
The JGI has helped boost the hiring of locals in some companies to “levels higher than in 2019”, said MOM.
From September to November last year, approximately the 27,000 firms hired a median of two local workers, as opposed to the median of one local hire in the same period a year ago.
Approximately six in 10 of the firms hired one to two local workers, while the other firms hired more workers.
Significantly, almost all of these firms happened to be small- and medium-sized enterprises (SMEs) , a trend that Manpower Minister Josephine Teo said her ministry was “very encouraged” about.
“It shows that SMEs have quite a lot of vitality and some of them are growing. It also shows that the JGI is providing them with a certain support and encouragement to expand their hiring,” she said.
Top hiring sectors
Some of the top hiring sectors are food services and retail, which employed one in five workers between September and November. Growth areas like wholesale trade, professional services as well as information and communications are responsible for nearly four in 10 of those employed.
According to MOM, companies had hired from “a wide pool of job seekers”, which included mature workers and those who were unemployed or from a different sector.
For example, about half of the 130,000 workers were unemployed at the point of hiring them. More than a quarter of works had been out of work for more than six months. Six in 10 were previously hired in a different sector. Importantly, these workers got the same or higher wages compared with their previous jobs.
Demographic composition of hires is also noteworthy as virtually half of the workers hired were mature workers aged 40 and above and one-third were aged 50 and above.
Under the JGI, companies were given a 25 per cent subsidy of the first S$5,000 of local hires’ gross monthly salaries for up to 12 months. This converts up to S$15,000 of wage support for each local hire.
Furthermore, employers who hire mature workers such as workers with disabilities and ex-offenders receive more support – up to S$54,000 per hire with effect from Mar 1.
According to MOM, more than 110,000 local job seekers were employed by 26,000 firms in September and October, and that the scheme added just 20,000 job seekers in the month of November.
4,000 workers hired for Logistic Sector
Under the JGI, Logistic sector has hired 4,000 workers, providing much-needed manpower to the sector. In order to meet the demand, Singaporean government also provided diverse professional conversion Programmes that made up of classroom sessions, structured on-the-job training and also mentorship for new mid-career hires over nine months.
More than 170 logistic companies to hire about 320 mid-career workers last year and they were hired for roles such as business development manager, logistics solutions analyst and supply chain technology manager.
Singapore’s innovative ways and means of microeconomic management are lessons for COVID- battered economies in the region. Obviously, job gains and minimising unemployment and skill conversion Programmes are prudent measures that would address immediate issues of unemployment, while supplying much-needed manpower to targeted sectors of the economy.
