Foreign workers under the spotlight in S’pore
Published on: Monday, August 04, 2003

SINGAPORE: Rising unemployment as wealthy Singapore stumbles into hard times has rekindled a debate on the presence of about 800,000 foreigners, most of them workers, in the tiny city-state.A report by two respected university economists that said foreign workers took three of every four jobs created between 1997 and 2002 was front page news and sparked an angry denial from the government, apparently concerned about a backlash.

Acting Manpower Minister Ng Eng Hen said that in reality, nine out of 10 new jobs during that period had gone to Singaporeans.

Although the economists later admitted they had made an “honest error,” the controversy whipped by their report is likely to persist as questions remain over Singapore’s policy of openness towards foreign workers, who account for about 24 per cent of the work force.

Unemployment is at 4.5 per cent - the highest since a recession in the 1980s - and workers currently employed are being asked to agree to steep wage cuts as the economy struggles to emerge from the impact of Severe Acute Respiratory Syndrome (SARS) and a global economic slowdown.

“Timing-wise, (the economists’ report) could not have come at a worse time for Prime Minister Goh Chok Tong,” said Song Seng Wun, a regional economist with GK Goh brokerage.

Government figures that Singaporeans took 90 per cent of jobs created between 1997 and 2002 “may not be taken as gospel truth by the man on the street,” Song added.

“It is an unnecessary problem for the government to deal with when they are trying to get the wage reforms going,” he told AFP.

“Unless the people are locked up behind bars, they can see for themselves how many foreigners are here in Singapore.”

Foreigners manage many top companies here, while labourers from China and Bangladesh are the mainstays of the construction industry.

Professionals, engineers and architects from Malaysia, the Philippines and other countries are fixtures in offices.

During a recent dialogue, Singapore’s founding father and current senior minister, Lee Kuan Yew, was asked by a trade unionist why some Singaporeans working for a local firm were retrenched, while Filipinos receiving higher salaries were retained.

The question was posed in terms of whether the supposed goal of cutting costs was achieved by the layoffs. “Our boys served their national service,” the 30 months of military training mandatory for all able-bodied Singaporean men, the interlocutor emphasised.

Lee responded that the policy of attracting foreign workers had served Singapore well because it allowed businesses to bring in investments knowing they could employ the best global talents.

These investments created jobs for both Singaporeans and foreigners, he said, warning the economy would falter if foreign workers were kicked out.

About 41 per cent of Singapore’s gross domestic product growth in the 1990s came from foreign workers, according to a Ministry of Trade and Industry report in 2001.

Without overseas workers, Singapore could not have achieved an average quarterly growth of 7.8 per cent during the period, said the report cited by the Straits Times on Saturday.

The government’s employment policy has long won support from the international community and analysts have warned backtracking on the open-door attitude to foreigners would hurt Singapore’s economy.

“Tightening restrictions on foreign workers could prove counterproductive,” said Michael Backman, an Australian economist, author and commentator on Asian political and economic affairs.

“Foreign workers attract investment to Singapore and help to promote trade. Rather than take jobs from Singaporeans it’s quite possible that their presence helps to create jobs.”

Another compelling reason to maintain a foreign presence in the Singaporean workforce is the lack of “sufficient entrepreneurialism” in the city-state, said Backman.

“In any event, foreign workers bring new knowledge and expertise. They also help to give Singapore a cosmopolitan feel and to lift its status to that of a ‘world city’ rather than being a regional backwater.”

In the end, companies will continue to hire foreigners if they find them cheaper.

“A lot of this involves the economics of trying to save costs,” said Nizam Idris, a regional economist with research house IDEAglobal.

“If it means employing cheaper foreign labour so be it.”- AFP


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