Mr Devadas Krishnadas’ observation of a “strong asymmetry between employment in our small economy and a global supply of labour”, in his commentary “Budget 2015: Making dollars and sense” (Jan 23), summarises the challenges facing Singapore’s labour market today.
The first, according to employers’ feedback, is that there are not enough Singaporeans to hire.
In keeping the economy competitive and resilient, the Government tries to grow many industries as fast as possible.
The prefabrication approach, which necessitates tapping the global labour market, is used to achieve quick results.
In some industries, such as wealth management, a relatively larger number of foreigners is needed to create a small number of jobs for Singaporeans. These foreigners create additional demand for domestic services and, hence, for workers.
The result of being successful in this strategy is that Singaporeans are probably spread thin over a large number of industries.
The second, according to employers’ feedback, is that Singaporeans are not as talented as foreigners. This is normally attributed to the educational system, which emphasises examinations.
However, there is another simple, numerical explanation.
Talent is both born and bred. Training will help to level up, but will be limited by inborn intelligence. On average, there should not be significant differences in the inborn intelligence of people across countries.
An average Singaporean would be more successful than an average person from a less developed country because of education and opportunities.
If a very intelligent person from a less developed country is given some of these, however, he would be likely to perform better than the average Singaporean.
Therefore, by tapping talents from around the world, we might end up crowding out the average Singaporean. The top 1 per cent of China and India combined is 20 million, far outnumbering the number of Singaporeans.
The third, according to employers’ feedback, is that Singaporeans’ wages are not competitive. A person’s wage is to meet three purposes: His own consumption, his dependents and his retirement.
The needs of a person from a less developed country for the last two purposes are generally lower. This also applies to the amount of time a person is able to put into work.
It explains why foreigners can work for lower wages and longer hours, rendering Singaporeans less competitive. To remain competitive, some Singaporeans choose to have fewer dependents, thus explaining Singapore’s persistently low birth rate.
There are justifications for some affirmative actions for Singaporeans in the labour market.
If the labour market here is subjected to naked global competition, the biggest loser might eventually be Singapore.
The first, according to employers’ feedback, is that there are not enough Singaporeans to hire.
In keeping the economy competitive and resilient, the Government tries to grow many industries as fast as possible.
The prefabrication approach, which necessitates tapping the global labour market, is used to achieve quick results.
In some industries, such as wealth management, a relatively larger number of foreigners is needed to create a small number of jobs for Singaporeans. These foreigners create additional demand for domestic services and, hence, for workers.
The result of being successful in this strategy is that Singaporeans are probably spread thin over a large number of industries.
The second, according to employers’ feedback, is that Singaporeans are not as talented as foreigners. This is normally attributed to the educational system, which emphasises examinations.
However, there is another simple, numerical explanation.
Talent is both born and bred. Training will help to level up, but will be limited by inborn intelligence. On average, there should not be significant differences in the inborn intelligence of people across countries.
An average Singaporean would be more successful than an average person from a less developed country because of education and opportunities.
If a very intelligent person from a less developed country is given some of these, however, he would be likely to perform better than the average Singaporean.
Therefore, by tapping talents from around the world, we might end up crowding out the average Singaporean. The top 1 per cent of China and India combined is 20 million, far outnumbering the number of Singaporeans.
The third, according to employers’ feedback, is that Singaporeans’ wages are not competitive. A person’s wage is to meet three purposes: His own consumption, his dependents and his retirement.
The needs of a person from a less developed country for the last two purposes are generally lower. This also applies to the amount of time a person is able to put into work.
It explains why foreigners can work for lower wages and longer hours, rendering Singaporeans less competitive. To remain competitive, some Singaporeans choose to have fewer dependents, thus explaining Singapore’s persistently low birth rate.
There are justifications for some affirmative actions for Singaporeans in the labour market.
If the labour market here is subjected to naked global competition, the biggest loser might eventually be Singapore.
