SINGAPORE can be “cautiously optimistic” about its economic prospects this year, with slowing growth but no outright contraction, said Prime Minister Lee Hsien Loong. But facing external risks and disruptive technological change, the country must adapt “while doing all we can to buffer those adversely affected”.

In his May Day Message on Sunday (Apr 30), the prime minister noted Singapore’s continued post-Covid economic recovery, particularly in earlier hard-hit sectors such as tourism and hospitality.

“Inflation is still high, but there is some hope it will moderate in the second half,” he said. “Meanwhile, unemployment rates have stayed low, and retrenchment numbers remain manageable.”

Yet he warned of multiple external threats: “serious geopolitical tensions”; recession risks as Western economies tighten monetary policy; and growing nationalism and protectionism, which undermine the multilateral trading system.

Meanwhile, economies will be disrupted by emerging industries such as the green and digital sectors, as well as new technologies such as artificial intelligence.

The country must adapt to these trends and support those who are affected, said PM Lee.

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Singapore’s survival depends on its continued openness, which involves transforming its industries, enhancing existing capabilities and building new ones for growth markets, he said.

“This will cause disruptions to some existing jobs, but at the same time it will create new jobs with better prospects for the future.” Singapore’s training and upgrading programmes are “progressing well” in equipping workers to seize such opportunities, he noted.

Employers, for their part, are maximising the potential of their workforce by providing training opportunities and encouraging workers to take these up. They are also accommodating employees’ needs through flexible work arrangements and job redesign.

As for the government, it has made progress in supporting lower-wage workers via the Progressive Wage Model, and will do more to professionalise skilled trade and improve career planning support.

“The Forward Singapore exercise is discussing these issues, including how to help Singaporeans improve their work prospects and resilience, and transition to new jobs and careers,” said PM Lee.

All of this requires strong tripartite collaboration between the government, employers and the labour movement, he said.

He highlighted the key role of the National Trades Union Congress (NTUC) in getting through the pandemic. The NTUC worked with employers and employees to implement wage-cutting measures – with management taking the lead in wage cuts – to “sustain businesses and save jobs”.

NTUC also set up the Job Security Council, which redeployed workers from pandemic-hit sectors such as aviation to others with pressing manpower needs, such as healthcare.

“Our model of tripartism is unique and precious,” PM Lee concluded. “As we move ahead in this difficult environment, let us reaffirm and nurture the spirit of tripartism.”