Singapore calls for higher productivity, skills

Singapore company registration specialists Rikvin is optimistic that the latest measures to moderate the country's dependence on basic-skilled foreign workers are a step in the right direction. Rikvin supports the Singapore government's call for business owners and workers to take road to higher productivity and skills.

According to the Budget 2012 statement, the Dependency Ratio Ceilings (DRCs) for foreign workers will be lowered by 5% respectively in the manufacturing and services sectors to 65% and 50%, respectively. Similarly, the sub-DRC of the S Pass for all sectors will be lowered by 5% to 20%. Additionally, the construction industry will see a 5% reduction in Man-Year Entitlements (MYE), as well as a higher Foreign Worker Levy (FWL) of S$500 (US$396) for every basic-skilled work permit holder in the MYE-waiver category.

All measures will come into effect on 1 July 2012. This means that firms that hire new foreign workers must abide by the new DRCs. They also have about two-year grace to adjust to and comply with the new DRCs for existing workers.

Analysis by Rikvin shows that these measures are necessary to wean Singapore off its dependence on basic-skilled foreign manpower. According to the Ministry of Manpower, foreign workers have grown at a rate of 7.5% per annum over the past two years.

Commenting on the uptrend, Mr. Satish Bakhda, Head of Rikvin's Operations said, "The momentum is not sustainable in the long run and we support the government's decision to mitigate the situation in a timely manner. Moving forward, Singapore needs more quality workers and not just high quantities of workers."