It's jeopardizing Asia-Pac's business hub.
According to a statement by the Singapore International Chamber of Commerce, the local talent market is "so stretched" such that wage hikes are adversely affecting inflation and business costs for firms. Consequently, Singapore's reputation as a "business hub" of Asia-Pacific is being marred.
Here's more from SICC's statement:
SICC, whose membership comprises a significant proportion of large multinational companies, says that many of the long-term principles outlined in the Population White Paper will benefit businesses and ultimately, Singaporeans.
Early planning to re-engineer the infrastructure for a growing population will be critical for Singapore to maintain one of its strongest competitive advantages, namely that of a stable environment in which multinationals can hub their business and plan for the long term.
A strong pool of Singaporean talent is another key factor that will continue to draw international businesses to Singapore.
It is, however, a fact that Singapore enjoys near full employment of its workforce and therefore suffers from manpower shortages that need to be addressed sooner rather than later.
The government has tightened its foreign manpower polices considerably in recent times, which has impacted large, medium and small businesses alike.
While we understand the ‘foreign talent’ sensitivities among Singaporeans, the economy needs to be viewed as an eco-system; it is not a zero-sum game that pits MNCs against SMEs, or locals against foreigners.
In fact, companies work together to create a multiplier effect in the local economy through job creation. Despite the persistent global economic uncertainty, Singapore remains a buoyant job market in which talent recruitment is a challenge across many traditional sectors such as hospitality and retail.
The local talent market is so stretched that rising wages are aggravating inflationary pressures and raising business costs for companies. This jeopardizes Singapore’s competitive positioning as a business hub for the Asia-Pacific region, if not addressed swiftly.
The manpower scarcity is exacerbated in new and growing industries such as biotechnology and energy, which need experienced and skilled resources.
The Singapore International Chamber of Commerce is committed to the long-term sustainable growth of Singapore as a global business hub with constructive feedback from our membership which represents a spectrum of industries.
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