You are here
Budget 2019 expected to support vulnerable PMETs: DBS economist
MORE “forceful policy measures” are expected to tackle the rising vulnerability of professionals, managers, executives and technicians (PMETs) in the upcoming Singapore Budget 2019, according to a report by DBS.
This comes as PMETs have become an “exceptionally vulnerable” segment of the labour force amid slowing growth momentum, observed DBS senior economist and author of the report Irvin Seah.
For the past nine years, the percentage share of PMETs among all retrenched workers has been rising, with the share of PMETs among retrenched workers now surpassing that for lower skilled workers.
“This may suggest that this segment of the labour force is increasingly facing more difficulties in maintaining their employability,” said Mr Seah. “This seems to defy conventional wisdom that being better skilled, the PMETs would be relatively more employable.”
He expects further enhancement to schemes such as the Professional Conversion Programme (PCP) and the Adapt and Grow initiative, which aim to help jobseekers reskill and acquire the necessary knowledge and competencies to take on new jobs.
In the report, he also suggested that the level of wage support could be increased, while more training grants to upgrade skills and additional resources directed at job matching could also be announced.
Beyond that, a temporary deferment or extension of their income tax payment, or a one-off tax rebate for these retrenched professionals could help in alleviating their cost burden, he suggested.
There could be a review on existing guidelines pertaining to skilled foreign workers. According to Mr Seah, an upward adjustment in the minimum salary requirement for employment pass holders or tighter requirements beyond the Job Bank could be considered. However, such a policy adjustment could also be announced after the Budget, he added.
Aside from a focus on PMETs, he said that the upcoming Budget is likely to zoom in on mitigating the challenges of an ageing population and helping to manage healthcare costs.
“Upward pressure on health spending, as well as other forms of social spending, will only continue to escalate unless measures are put in place to manage that,” he noted.
Besides subsidies and insurance coverage, there could even be a need to introduce health-related taxes such as a sugar tax to encourage public health consciousness, said Mr Seah. Singapore has one of the highest incidences of diabetes among developed countries, coming in second behind the US.
Finally, Mr Seah said that policymakers will continue to focus on “preparing Singaporeans for the future” in the upcoming Budget.
With disruptive technologies that could potentially render jobs redundant, there is a need to invest in education and skills upgrading, he said.
He believes that efforts directed at strengthening the social safety net and public support measures will also be featured in Budget 2019, given an “increasingly difficult economic climate”.
Mr Seah concludes that the upcoming Budget is likely to address longer term structural issues, instead of dwelling on the rising economic risk in the global environment.
“Nonetheless, with the surpluses accrued in the past budgets, the government is in a good position to roll out strong counter-cyclical fiscal stimulus should economic conditions warrant that,” he added.