Changes to foreign worker levies will hurt bottomline
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The Economic Strategies Committee has recommended that the foreign worker levies be raised, in a bid to move Singapore away from it's over-dependence on foreigners.
But industries reliant on a strong foreign workforce say their bottom line will be hurt.
And massive changes will need to take place for companies to stay viable.
Joanne Chan reports.
Foreigners make up nearly 90 percent of the workforce in the construction industry.
And companies say it's difficult to attract locals, due to the long hours and back-breaking work involved.
With the proposed changes to the foreign worker levies, construction businesses are now staring at a cut in manpower, or face higher costs.
Executive Director of the Singapore Contractors Association, Simon Lee, said companies will have to relook their hiring policies.
The Association represents more than 2,000 companies, who collectively hire 200,000 workers.
"We got to look at, are they (foreign workers) effectively used, whether there's any spare capacity that we can actually look at and even cut it if necessary."
Another option is for companies to invest in new technology to make up for the shortfall in manpower.
But these changes will not come easy, said Chief Executive of the Singapore International Chamber of Commerce, Phillip Overmyer.
"The way we build buildings in Singapore is not at all like the way high-end countries build buildings. Japan, Australia and America and other countries, use completely different technologies that don't employ nearly as much foreign labour. So if we're going to make those changes I think it could be a very difficult time for the construction industry to adapt to that."
However, Mr Overmyer noted that some industries which were traditionally reliant on foreign workers, have already made productivity improvements by turning to technology.
"In the manufacturing sector, they have been doing this for a very long time. Raising productivity, they are always putting new equipment in, higher technology, and they keep moving up the line."
The Economic Strategies Committee did not reveal how much the foreign worker levies will be raised.
More details will be announced by the Government during the Budget later this month.--938Live
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Duh.
But on the flip side, increasing foreign worker levies means the government can make more money out of foreign workers and businesses.
Wah, make money again.
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The world class paid govt is only good in using money to solve problem. haahah! money money money!
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Else who is going to pay for their obscene salary increase this year..?