The aid comes as a manpower shortage in Singapore drives up labour costs
Labour-intensive sectors in Singapore, which rely heavily on migrant workers, will see their foreign worker levy rebates increase until the end of the year. Some 15,000 businesses stand to benefit from the scheme which will now pay back $250 a month, up from $90 a month, for each work permit holder they employ.
The additional government support, lasting all the way through December, aims to help employers in construction, marine shipyard and process (CMP) weather the current manpower shortage. “In 2020, the number of work permit holders in these sectors declined by nearly 60,000, or 16%,” the Ministry of Manpower (MOM) said.
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The deficit in labour supply came about as a result of the more stringent COVID safety protocols implemented across worksites as well as the government’s tighter border restrictions. Measures regulating the influx of migrant workers thus triggered an increase in labour costs. However, the rules will likely remain in place for months.
The same sectors that demand skilled migrant workers play a vital role in Singapore’s economic development post COVID-19. “To help the sectors tide over this difficult period and retain enterprise capabilities for Singapore to emerge stronger from COVID-19, these firms will receive higher FWL rebates from May to December 2021,” MOM said.
Read more: These workers were worst hit by the COVID-19 crisis
“The first round of the increased FWL rebate in May 2021 will be paid out in the following month. Employers can consider making use of the FWL rebate to retain existing workers and bring in Work Permit Holders from lower-risk countries or regions,” the ministry said, highlighting a possible extension of the programme sometime in December.
“The CMP sectors play an essential role in Singapore’s development, and government agencies are working closely with the CMP sectors through the Industry Transformation Maps to transform their businesses and reduce manpower reliance to become more resilient to future shocks,” MOM said.
“However, these efforts will take time to bear fruit. In the immediate term, the increased costs continue to weigh heavily on these firms.”
