WHILE the industries of the world are changing rapidly as new business models disrupt existing ones, Singapore firms should not stay stagnant and let the competition overtake them.
At the annual May Day Rally on Sunday, Prime Minister Lee Hsien Loong spoke of the growing popularity of online retailers Taobao and Amazon, home-share booking site Airbnb, and private-car hire services such as Uber and Grab.
"What do we do? I don't think we can stop this phenomenon and I don't think we should try to stop it," he told his audience of unionists, politicians and business leaders at Downtown East in Pasir Ris.
"Can we put up a Great Singapore Firewall to block websites like Amazon or Taobao? Can we ban ride-sharing and taxi booking apps, like some other cities have done? Maybe we could try, but we probably won't succeed and certainly we will end up hurting ourselves," he added.
Mr Lee went on to add that these new businesses and services have improved the lives of consumers and commuters because they are convenient and give more options and better deals.
What Singapore can do is to have an environment that allows businesses with new operating models to compete on "fair terms" with existing ones, said the prime minister.
With Uber and Grab, for instance, he said that the authorities have reviewed the laws to ensure a more level playing field with traditional taxi operators.
Beyond this effort, the government wants to help industries and companies compete better by supporting them as they transform.
Mr Lee hailed Finance Minister Heng Swee Keat's announcement at this year's Budget in March that a sum of S$4.5 billion would be set aside over five years for the new Industry Transformation Programme.
"(It will) help industries use R&D and technology in order to adapt, and be able to prosper and be creative. If they are creative and bold, (it can) even help them to find new models and processes to outcompete others. Be the disruptor, don't just sit there and let other people disrupt you," he said.
During his 40-minute address, Mr Lee explained that jobs in Singapore will also change as the economy undergoes this major transformation.
As new jobs are created in newer industries, the older jobs will be displaced by technology or move elsewhere to lower-cost countries.
This, said Mr Lee, is why the retrenchment numbers here are going up despite the economy still growing and when the job market is still tight and expanding. The job losses are hitting both the rank-and-file workers, as well as those holding supervisory and management positions.
As there is a "steady flow" of quality investments coming into Singapore, there isn't a problem of a lack of jobs at the moment. Instead, the issue is how to match workers' skills and expectations with the available jobs and the skills that are in demand.
What's also changing is the shape of the local workforce, with the PMET group - professionals, managers, executives and technicians - growing to two out of every three workers by 2030, up from 54 per cent currently.
Mr Lee praised the labour movement, which has traditionally catered to the rank-and-file and blue-collar workers, for reinventing itself to stay relevant to cater to PMETs.
It has expanded its services beyond collective bargaining to include career counselling, networking and skills upgrading, among others.
"That is why although many countries see union membership going down, in Singapore ours is growing. You need to strengthen the labour movement even more in order to fight for workers more effectively," he said.
As unions here try to negotiate collective agreements to include PMETs, Mr Lee noted how this process would take time and many employers were still being cautious and unsure about how things would pan out.
"I encourage employers to take courage and be bolder. Don't believe that if you don't have the labour movement involved with the PMETs, you can deal with the PMETs one by one and you would have no problem," said Mr Lee.
He pointed out the uniqueness of the country's healthy tripartite relationship between the government, unions and employers, and it was this strong level of trust that has enabled Singapore to thrive for the past 50 years.
While Singapore may be in a period of change, the prime minister reassured the nation that any problem could be overcome as long as all the tripartite partners work together.
Like many other countries, Singapore workers are concerned about housing costs, healthcare, retirement and salaries, but Mr Lee pointed out that the country has effective programmes and schemes in place to tackle all these problems.
"The government is ready. The labour movement is ready. The people are ready. You have supported our programmes, you've voted for them and for the team to work with you at last September's general election," said Mr Lee as he stressed the need for all parties to work together.
"Because we have a strong mandate, we are able to implement these programmes vigorously in order to improve people's lives."