Impacts of Foreign Worker in Singapore

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In the last few years, Singapore has developed into a global city and economic center. In order to keep the position of economic center, not only the government but also the residents make every effort to build a better Singapore. With a safe living environment, a lot of job opportunities, it has attracted a large numbers of foreigners to work here. As the population of foreign worker is growing, there are some benefits and challenges brought by them. In this essay, I will explain three positive impacts of foreign workers such as they play an important role in improving Singapore economy in the long term.

In addition, I will also present three impacts resulted from the migration of foreign workers, and will give solutions to relieve these challenges. 2. Demographic Profile of Foreign workers “Composition of Singapore’s Total Population” (2012) presents in December 2011 there are 1. 46 million non-residents in Singapore. 21% of the non-residents are family members of the residents or employment pass holders, and international students. The other 80% of non-residents are foreign workers: Chart 1: Population of foreign worker in Singapore as of Dec 2011 Source: Department of Statistics, Ministry of Manpower Numbers do not add up due to rounding] •14% of them are foreign domestic workers (FDWs). They engaged in housekeeping, or eldercare or childcare, they allow more Singaporeans to go to work, especially stay home mothers. •46% of them are low-skilled or semi-skilled workers on work permits.

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They work in industries in which is difficult to employ Singaporean. For instance in construction and marine sectors. •8% of them are mid-level skilled foreign workers (S pass holders). They work in sectors such as retail, food and beverage, manufacturing and healthcare services. 12% of them are higher-skilled foreigners who work on Employment Passes(EP). They include professionals, managers, executives and technicians(PMET). They are mainly work in financial services, aerospace engineering, research and development (“Composition of Singapore’s Total Population,” 2012). 3. Reasons Singapore Need Foreign Workers 3. 1 Low Birth Rate Singlehood, late marriage and late childbirth are common trend in Singapore. Moreover, the work and economic stress also get more and more significant in life, these result in low birth rate (“Our Demographic Challenges and What These Mean to Us,” 2012).

For example, most people now want to continue with higher education, they will delay the time to get married and have babies. 3. 2 Ageing Population “Our Demographic Challenges” (2012) revealed from 2012, Singapore begin to experience an unparalleled ageing changes, because many people who are born after the second world war become old. They also present that more than 900,000 old people will retire from work and stay at home. With current low birth rate and without any measures taken, the median age of Singaporean will change from 39 in 2011 to 47 in 2030. . 3 High Skilled and Low Skilled jobs On one hand, Singapore do not have enough high skilled workers especially in some new industries, so government need to attract PMETs to help to maintain the sustainable development on them. On the other hand, as most Singaporean do not want low-skilled jobs, companies have to employ foreign workers. Therefore, foreign workers are required in high skilled and low skilled jobs. (“A Sustainable and Vibrant Economy,” 2012). We can see from chart 2. Chart 2: Composition of PMET workforce and Non-PMET workforce

Source: Minister of Manpower;Non-resident PMETs include EP and S pass holders. 4. Impacts of Foreign Workers to Singapore 4. 1 Positive Impacts 4. 1. 1 Achieve Economic Growth As we know, the economic growth related to the growth of productivity. Nevertheless, productivity is linked with workforce. The Singapore workforce is limited in population, so that many foreign workers could help to improve productivity to enhance economic performance. A classification of foreign workers in the Singapore economy (excluding foreign domestic workers, or FDWs) is provided in chart 3.

Chart 3: Distribution of foreign workers in economy as of Dec 2011 Note: Figures in brackets refer to the absolute number of all foreign workers (including P,Q,S Pass and Work Permit Holders) in the various sectors, excluding FDWs Sources: Minister of Manpower, Dec 2011 4. 1. 2 Diversify Human Capital In recent years, Singapore has been making great effort to ensure its competitiveness. Government attract foreign top talent to work here to help to achieve the goals. For example, in higher education institutions, many foreign professors are hired to teach students especially in their major course(Leow, 2010).

At the same time, the government also hires foreign workers in construction, services and manufacturing sectors which is also essential for the economic growth. 4. 1. 3 Increase Income and GST Tax Revenue Foreign workers also play a crucial role in the tax revenue. “Ministry of Trade and Industry(MTI) occasional paper on population and economy” (2012) describes that foreign worker not only lead to the increase of total personal income taxes, but also added to Good and Service Tax(GST) tax base. For instance, 20% of all income tax payers are foreigners, however they devoted over 25% of the total personal income taxes.

Therefore, foreign workers make a net fiscal contribution to their working countries (Vargas-Silva, 2011). 4. 2 Negative Impacts 4. 2. 1 Congestion in Public Transport System According to “Labour Force – Ministry of Manpower” (2012), from 2004 to 2010, the number of foreign workforce increased by 78. 9% from 608500 to 1088600. Nevertheless from 2004 to 2008, SBS has made their effort to increased the number of buses in their company by 19. 3% (Zhao, 2011). Clearly, the public transport system could not satisfy the demand of large numbers of foreign workers. . 2. 2 Tighter Housing Market In recent years, housing prices always continue to rise and rose to a new peak in 2012. This not only be credited to demand for housing by foreign workers, but also resulted from the sustainable growth on renting by foreign worker. The rental and housing market became competitive, This affect the local Singaporeans who can not afford to buy a house. 4. 2. 3 Conflicts with Labour Laws Some foreign workers are not familiar with Singapore Labour Laws and do not know how to solve their complaints properly.

Therefore, it is easy to conflict with Singapore laws. For example, the latest news that on November 26, in order to protest against inequitable pay rises, 171 Chinese bus drivers go on a strike. After this strike, government sent back 29 of them, also arrested and charged 5 workers. (Tan, 2012). Chart 4: SMRT bus drivers’ illegal strike More than 100 Chinese bus drivers went on a full-day strike on Monday over pay disparity issues. (Yahoo! photo) 5. Solutions to Reduce Negative Impacts of Foreign Workers in Singapore 5. 1 Control the Population of Foreign Worker

With above concerns, the government should not add foreign worker with no limitation, and they need to control the population of the latter here. They also need to consider all the economic and social factors, and try to find an appropriate scheme that is not too much foreign worker for citizens to complain about, neither too few workers for industries to work with. 5. 2 Upgrade Public Transport System Faced with the crowed transport system, transport company should cooperate with the government to relieve this phenomenon.

They can improve the efficiency by add the number of bus and train during per hour. This will reduce the waiting time between this bus or train to the next bus or train. It not only make the vehicle not so crowed but also could raise working efficiency. 5. 3 Control the Quality of Foreign Workers The Government should control the quality of foreign workers on all skills levels. These measures include having a test before they come to Singapore, receiving some training before work, and a higher income and education criteria for foreign workers.

However this could not finish at once, it will need a period for companies to change and adapt to. once it is being adopted, it is good for Singaporeans and foreign worker themselves. 6. Conclusion In conclusion, in a long time foreign workers boost Singapore’s economy growth at a high speed, make Singapore’s workforce diversification, contribute the fiscal revenue. In spite of these, they also pose few challenges including congestion on public transportation, tighter housing market, conflicts on labour laws, which are also closely related and affect Singapore in a long term.

With these problems, some effective measures comprising control the population of foreign worker, upgrade public transport system and control the quality of foreign worker should be taken to relieve these challenges. At the same time, on one hand, government should keep a strong and harmonious society, on the other hand, a rapid and steady economic growth should be guaranteed. Moreover, the government also need to take into the majority social and economic environments and balance benefits and challenges, In case these measures could be taken, Singapore could expect to maintain the designation of economic center of Asia.

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Impacts of Foreign Worker in Singapore. (2016, Oct 19). Retrieved from

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