Around 20% of enterprises here are foreign-owned, but these firms employ 60% of Singaporeans in high-paying employment. On September 17, the Ministry of Manpower (MOM) issued numbers revealing that foreign-owned enterprises employ an outsized share of those with a gross monthly income of more than $12,500 and fall into the top 10% of the income distribution.
This revelation comes at a time when Singapore's economy is experiencing a significant shift towards high-value industries. The city-state's strategic positioning as a global hub for finance, technology, and innovation has attracted numerous multinational corporations, contributing to the creation of well-paying jobs for local residents. The government's long-term economic strategy, which focuses on developing key growth sectors, appears to be paying dividends in terms of employment opportunities for Singaporeans.
According to the ministry, the data highlight the need of attracting international investments and the global talent that comes with them, in order to balance local resident workforce growth and provide good opportunities for Singaporeans. The decision to publicize these figures, a first for MOM, comes amid ongoing concerns from some quarters about job opportunities for locals.
Foreign-owned enterprises are those with less than 50% local shareholding and at least one employee. Overall, these enterprises employ approximately one-third of employed inhabitants, including permanent residents and citizens, according to MOM's most recent labor market data for the second quarter of 2024.
The impact of foreign-owned enterprises extends beyond direct employment. These companies often bring with them advanced technologies, innovative management practices, and global networks that can benefit the wider Singaporean economy. Local businesses, particularly those in the service and support sectors, often experience increased demand as a result of the presence of these multinational corporations. This creates a ripple effect, indirectly supporting job creation and economic growth across various sectors of the economy.
It went on to say that foreign-owned companies generate business for local small and medium-sized businesses, which employ the vast majority of residents. The data also revealed that, while the unemployment rate improved during the quarter, the proportion of retrenched residents who found new jobs within six months decreased significantly. This re-entry rate dropped to 55% from 59.4% in the previous quarter.
Mr Ang Boon Heng, director of MOM's manpower research and statistics department, stated that this figure has been steadily declining over time. "What it actually suggests is that more and more people are taking the time to look for, and train for, better jobs," he told reporters during a media briefing on September 16.
He also found that the re-entry rate improves dramatically over time, reaching approximately 70% by the 12-month mark. According to MOM's polls, the remaining 30% who did not start employment were individuals who were not actively looking for work or were planning to become self-employed, he said.
If 30% of people had difficulty finding work, the long-term unemployment rate should have risen, but this has not happened, he said. The long-term unemployment rate in June 2024 was 0.8%, the same as in March. In June, the jobless rate improved across the board when compared to March. The seasonally adjusted unemployment rate for residents was 2.7%, 2.8% for Singaporeans, and 2% overall.
This is a decrease from 3% for residents, 3.1% for Singaporeans, and 2.1% overall in March. With the decrease in the number of unemployed, the seasonally adjusted ratio of job openings to unemployed individuals rose from 1.56 in March to 1.67 in June. In June, there were 81,200 seasonally adjusted vacancies, down from 81,900 in March.
According to MOM, more than one in every five job vacancies was in growth industries, which are connected with higher productivity and income. Financial and insurance services, professional services, and technology and communications are among the fastest growing industries.
The concentration of job vacancies in these high-growth sectors underscores Singapore's ongoing economic transformation. As the nation continues to position itself as a leading digital and financial hub in Asia, there is an increasing demand for skilled professionals in areas such as fintech, cybersecurity, and data analytics. This trend is likely to persist, creating both opportunities and challenges for the local workforce. To address this, the government and private sector are intensifying efforts to upskill and reskill Singaporeans, ensuring they remain competitive in an evolving job market.
Meanwhile, total employment increased by 11,300 in the second quarter, more than doubling the 4,700 recorded in the previous quarter. Non-residents accounted for the whole increase, while resident employment decreased by 600.
While there were more residents working in growing industries, this was more than offset by seasonal losses in retail trade and administrative and support services. Non-resident employment growth was mostly led by construction and manufacturing, which rebounded from the previous quarter's decrease.
According to MOM, the increase was primarily caused by work permit holders who took on non-PMET (professional, management, executive, and technical) tasks that residents do not want to work in.
Retrenchments increased to 3,270 in the second quarter from 3,030 in the first, with increases seen in financial and insurance services, as well as wholesale commerce. The ministry anticipates wages and employment to rise in pace with economic growth.
The financial services, information and communication technology, and professional services sectors, as well as the impending Formula One Singapore Grand Prix and year-end festivities, are projected to enhance resident employment.
Nonetheless, Manpower Minister Tan See Leng stated that Singapore's high labor force participation, ageing population, and dwindling local workforce indicate that resident workforce growth will decelerate in the long term.
He referenced Acronis, a home-grown cyber-security company, as an example of a corporation with a balanced mix of foreign and domestic employees. Dr. Tan paid a visit to the company's Suntec City office on September 16.
The firm is looking for tech expertise, such as software developers, to join the nearly 180 employees in its Singapore branch. Dr Tan stated that Acronis has invested in its local staff in order to enhance its cyber-security solutions, utilizing staff Singapore's Career Conversion Programme for Tech Professionals.
A total of 30 research and development engineers at the firm are on a three-month program until September to gain abilities in additional areas of software development through on-the-job training and online courses.
This initiative by Acronis exemplifies the growing trend of companies investing in their local workforce to meet the evolving demands of the tech industry. Such programs not only enhance the skills of Singaporean professionals but also contribute to the nation's goal of becoming a global leader in technology and innovation. By bridging the skills gap and creating a pipeline of local talent, these efforts help to ensure that Singaporeans can compete effectively for high-value jobs in the increasingly digital economy.
Ms Cheryl Tay, 30, has enrolled in Acronis' career conversion course to train as a full-stack developer. She is currently a front-end developer who has spent over four years working mostly on the software interface with which users interact, but she enrolled in the program to learn about the back-end, which refers to the underlying software that users do not see.
She claims that being a full-stack developer, as they are known, enables her to understand how to make the front-end and back-end function more effectively together.
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