SBF calls for more nuanced approach in foreign manpower for services, seeks more source countries

THE Singapore Business Federation (SBF) is calling for a more nuanced approach in classifying business activities in the wide-ranging services sector, to allow for more differentiation in foreign manpower policy.

This is among 9 proposed “key actions” in a 32-page manpower policy paper published on Thursday (May 12), alongside suggestions such as expanding the list of non-traditional source (NTS) countries from which work permit holders can be hired.

SBF noted that the services sector covers a diverse range of industries, including professional services, retail and wholesale trade, hotels and food services – yet they are all subject to the same work permit requirements, such as source countries, maximum period of employment, the dependency ratio ceiling (DRC) or quota, and the corresponding levy rate.

“This broad classification does not reflect labour market dynamics such as the nature of work, education level, job demand and resident labour force supply across the significantly different services industries,” said SBF.

“It is imperative to recognise that the job roles in knowledge-intensive activities like finance and insurance, ICT (infocomm technology), and professional services are fundamentally different from that of waste management, cleaning and EFM (estate and facility management),” it added.

Suggesting that this be reviewed, SBF said the tripartite partners can work together on a “more nuanced” classification of business activity, so that specific manpower challenges can be addressed by differentiated policies.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

For example, the hours worked by all local casual labour in lifestyle services – retail, food service, hotels and nightlife industries – can be aggregated and computed as local headcount for calculating the foreign worker quota, given the industries’ dependence on casual labour.

The policy paper was developed in close consultation with 8 trade associations and chambers, including the Restaurant Association of Singapore (RAS), Singapore Hotel Association (SHA), Singapore Retailers Association (SRA), and Singapore Nightlife Business Association (SNBA).

The DRC and related foreign manpower policies at the sub-sector level can also be recalibrated, to better allocate manpower to the neediest industries without upsetting the overall foreign manpower balance, said SBF. The DRC is the maximum proportion of S Pass and Work Permit holders that a company is allowed to employ.

The upcoming 3-year Manpower for Strategic Economic Priorities (M-SEP) scheme, which allows firms to bypass foreign worker quotas, is “ultimately a time-bound initiative which will not address enduring manpower challenges faced by lifestyle services, environmental services and EFM services”, SBF said.

Another proposed key action is to expand the upcoming NTS occupation list that allows work permit holders in certain roles to come from more countries, as well as the list of NTS countries and regions itself. Currently, manufacturing and services firms can only hire such workers from Malaysia, mainland China, Hong Kong, Macau, South Korea and Taiwan.

From Sep 1, work permit holders for specified occupations – for example, cooks in Indian restaurants and food processing workers – may also come from Bangladesh, India, Myanmar, the Philippines, Sri Lanka and Thailand. This is because a higher S Pass salary will kick in then, which means current S Pass holders in such roles may not qualify.

SBF noted that the NTS occupation list covers jobs that are usually labour-intensive or in inaccessible locations, which Singaporeans are thus not inclined to take up. Given these job characteristics, the list can be expanded to include rank-and-file positions in environmental services, such as general waste collection crew, recyclable sorters, waste treatment and disposal workers, said SBF.

Melissa Tan, chairman of the Waste Management and Recycling Association of Singapore (WMRAS) – which was also consulted – said: "While the industry continues to attract Singaporeans to sustainability and technology related jobs, we continue to need manpower in the rank-and-file jobs such as waste collection and sorting, and facilitative manpower policies will enable businesses to operate at capacity and serve the needs of the nation."

SBF suggested that the tripartite partners, in consultation with trade associations and chambers, can also study the case for including other occupations, particularly those frequently in the list of top 10 non-PMET (professionals, managers, executives and technicians) job vacancies. From 2012 to 2021, rank-and-file roles that were consistently the hardest to fill included cleaners, security guards, shop sales assistants, waiters and kitchen assistants.

Meanwhile, the list of NTS countries can also be expanded to potentially include Cambodia, Indonesia and Vietnam, SBF said, citing industry feedback.

Another suggestion is that international students of services-related programmes could be allowed to take on internships and part-time work related to their courses, while such graduates could be offered “time-bound work passes” in services related to their field of study.

Besides foreign manpower policy, the SBF’s 9 proposals include 3 on talent and 3 on cross-sector teamwork.

First, for talent, the tripartite partners can actively co-ordinate the redeployment of workers from pandemic-related roles to the manpower-strapped lifestyle services industry, now that most Covid-19 restrictions have been lifted. As of last month, there were about 2,000 safe-distancing ambassadors employed by the government.

Second, businesses can improve the “value proposition” of jobs in the lifestyle, environmental and EFM services, which are perceived by local workers as involving long hours and physical exertion. Companies can strive ”to meet workers where their priorities lie”, such as by tapping tripartite resources to offer flexible work arrangements, or offering weekly or fortnightly wage crediting for workers who value higher pay frequency.

Third, firms should prioritise workplace training, and work with the National Trades Union Congress (NTUC), SkillsFuture Singapore, Workforce Singapore and schools to co-develop business transformation plans and training programmes.

On the teamwork front, greater cross-sector collaboration can help firms achieve higher operational efficiency and better resource allocation, and TACs can help facilitate this, said the federation. For example, there is room to co-operate around retail and logistics, since many retailers have expanded into e-commerce.

During the pandemic, some frontline sales staff pivoted to fill backend logistics fulfillment roles, but this may no longer be viable as the economy reopens. Instead, retailers can tap on e-commerce enablers and logistics providers, an approach that supports economies of scale and is similar to how smaller firms use shared services in human resources and finance, SBF said.

Two other teamwork suggestions are that more multinational companies and large local enterprises step up as “Queen Bees” to help small and medium-sized enterprises in their industries; and that businesses switch to outcome-based contracts for estate and facility management.

SBF said while some issues encountered by firms in the lifestyle, environmental and EFM services during the pandemic are more “transitory” in nature, “the manpower challenges in these industries precede the pandemic and are expected to worsen as economic activity ramps up this year”.

Lam Yi Young, SBF’s chief executive, said the federation is looking forward to working with the industry, NTUC and government agencies to follow up on the key actions outlined in the paper.

In a Facebook post, NTUC assistant secretary-general Desmond Choo said the labour movement would need to further study the specific recommendations with its tripartite partners.

Noting that some sectors are coming under greater manpower strain amid the recovering economy, he said: “We appreciate the effort by SBF to address the manpower crunch and agree that more can be done to ensure that this crunch does not affect business and service delivery.”