Banks, tech firms hit by new work pass restrictions

Singapore

SINGAPORE'S new restrictions on work pass holders from higher-risk regions could cause temporary uncertainty for companies in the technology and financial sectors, but this blip is unlikely to significantly dent expansion plans, observers told The Business Times.

Industry watchers believe that banks and tech companies alike have the bandwidth to adapt and pivot accordingly to meet their needs. This comes as the tech and financial sectors have adapted well to remote work during the pandemic, and are still rapidly hiring for their growth plans.

Last Friday, the Ministry of Manpower (MOM) announced that Singapore has stopped accepting new entry applications for work pass holders from countries or regions with a higher risk of Covid-19. Work passes include work permits, S-Passes, and Employment Passes.

The ministry said that it will reschedule entry for those who had earlier obtained approval, with the exception of those from the construction, marine shipyard and process sectors, and migrant domestic workers.

Relocating people from other locations to Singapore in the midst of a pandemic is not something businesses are likely going to rush into; rather, it is an exception, said Amit Gupta, president of The Indus Entrepreneurs Singapore (TiE), a global entrepreneur and investor foundation.

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Instead, companies are more likely to simply manage their global workforce remotely and conduct hiring processes online as a stopgap measure.

David Leong, managing director of HR consultancy PeopleWorldwide, said that hiring trends have shifted and employers are open to work from home. ''Even bankers are reaching out to clients without meeting face to face,'' he pointed out. ''We know that banks are already hiring bankers to be based in their home country to solicit and to support clients.''

In the tech sector, it is also "quite commonplace" to see local teams augmented with foreign tech talent teams based elsewhere, said Christopher Quek, managing partner at early stage venture capital firm TRIVE. "With these new measures, it will likely turn the hybrid remote teams to a mainstream development."

As the world eases into the new era of remote or hybrid work, companies that have adjusted faster might find it easier to attract talent overseas. This could help them scale up across markets.

Tech founders in South-east Asia know the importance of localisation and hiring local partners, said Tan Yinglan, founding managing partner of VC firm Insignia Ventures Partners. "Tapping into a diverse pool of talent early on provides a considerable advantage in scaling across markets."

However, hiring overseas might not be the most secure or sustainable option. SMU Associate Professor of Law Eugene Tan reckons companies in the city-state should also look towards the domestic market.

"With the various schemes in place to develop talent for the tech sector, including mid-career conversions, this may well be the most secure manpower source in terms of ready supply and quality," he said.

And some are doing just that. Singapore patent analytics startup PatSnap told BT that it will "double down" on efforts to upskill its in-house talent, considering the uncertainty due to the pandemic.

Deeptech startup Transcelestial and cyber security firm Ademco told BT that they prioritise locals in the hiring process. Group managing director of Ademco, Toby Koh, told BT that the company has "no current or immediate future plans to hire foreign talent who are not currently in Singapore".

Likewise, since the start of the pandemic, Transceletial has "reoriented towards heavily searching every nook and corner of Singapore for people with relevant skills and experience first," said founder and CEO Rohit Jha.

Circles.Life said it has a graduate development programme Circles Academy - supported by the Infocomm Media Development Authority (IMDA) - which has helped in engaging locals here.

Meanwhile, banks reiterated their earlier stance that they are strengthening their Singapore core and said that customers will not be affected by the new hiring restrictions.

Jacinta Low, head of HR Planning, OCBC Bank, said: "With more than 90 per cent of our workforce in Singapore being locals, the bank is well-positioned to ensure continued service levels to our customers."

Similarly for Maybank Singapore, a spokesperson pointed out that the majority of its staff are locals. "At this point in time, the announcement has little impact on our manpower planning," said the spokesperson. "The foreseeable impact in the future will be the recruitment of competent IT personnel in certain specialised roles."

HSBC Singapore's head of HR Brandon Coate said that as an international bank, diversity of talent is critical.

"We will continue to seek and attract international talent for select roles," he said. HSBC will also develop the skills and experience of current employees to take on more senior roles, and also attract local talent, he added.

BT also reached out to DBS, UOB, Citi and Standard Chartered for comments on Sunday.

CIMB Private Bank economist Song Seng Wun noted that even though banks are well equipped to meet the new challenge, the restrictions add further uncertainty in addition to the issues that banks are already facing in certain markets such as pandemic-struck India.

"At worst, some projects that banks want to embark on may be delayed," he said. "The impact differs from bank to bank, depending on their individual projects, and also how long this suspension will last."

He added: "But what we have seen over the past year is that banks will cope, adapt and move on."

Less sanguine is Lawrence Loh, associate professor, NUS Business School. He noted: "All the affected sectors will feel the pinch, perhaps even more so for the banks and financial sector."

While there can still be talent flows from lower-risk countries and regions, he pointed out that many of the countries in South Asia and Southeast Asia are "critical sources that are hard to be substituted by others".

That being said, he does not believe that the hiring restrictions will likely impact Singapore's reputation as a choice employer.

"We are seeing many other jurisdictions adopting the same caution in the intake of manpower from the higher-risk places," said Prof Loh.

Remote hiring may be an option, but there are limitations due to security and controls. The only way for banks to overcome this is to "vigorously reduce reliance on manpower such as through transformation or technology", he noted.