Article: Singapore sets aside S$4 Bn to preserve jobs in Budget 2020


Singapore sets aside S$4 Bn to preserve jobs in Budget 2020

Jobs are the number one concern during this period of economic downturn and epidemic outbreak, according to Singapore's Finance Minister, Heng Swee Keat.
Singapore sets aside S$4 Bn to preserve jobs in Budget 2020

The Singapore government today announced a S$4 bn stabilization and support package as part of its Budget 2020, to help workers stay in their jobs and help businesses stay afloat during the economic downturn exacerbated by the novel coronavirus outbreak.

"Our foremost concern is jobs," Finance Minister Heng Swee Keat said in his budget statement on Tuesday. "We want to help our workers retain their jobs and use any lull period to upgrade their skills, to be ready when the tide turns."

Retaining jobs through reducing labor costs

The larger part of the funding, roughly S$2.4 Bn, will go into defraying wage costs for businesses. S$1.3 Bn will be spent on a jobs support scheme that covers eight percent of every Singaporean employee's wages for three months, up to a wage cap of S$3,600: the objective, said Heng, is to help enterprises retain their workers.

Another S$1.1 Bn will go to enhancing the government's existing wage credit scheme, an initiative first launched in 2013 that supports wage increases for Singaporean workers earning a salary of up to S$4,000 per month. Budget 2020 provides for increasing that limit to S$5,000 per month, and will retroactively apply to wage increases given in both 2019 and 2020.

Recovering at-risk jobs through reskilling

As hinted in earlier statements, the government will also give additional support to sectors that are particularly hard hit by the novel coronavirus, specifically tourism, aviation, retail, food services. Because workers in these sectors are considered at higher risk of losing their jobs, the government intends to give them extra help in finding new positions: workers who reskill can currently get funding for up to three months, but the time limit will be extended to six months for these four specific sectors. An estimated 330,000 workers will benefit.

On top of these measures, the government is pushing harder for Singaporean workers to reskill. Budget 2020 provides for a one-off S$500 top-up to SkillsFuture Credit, a targeted funding for Singaporeans who want to learn new skills or obtain new qualifications. It also introduces a version of the funding for enterprises, giving them S$10,000 to defray the out-of-pocket costs of business transformation, job redesign, and skills training. Companies will additionally get an extra incentive for hiring mid-career workers in their 40s and 50s through reskilling programs.

The road to recovery

It is clear from the Budget 2020 measures that the Singapore government is determined to soften the impact of the economic downturn and the coronavirus outbreak on workers: unsurprising, given that with the country’s aging population and Singapore’s vulnerable position as a trade hub reliant on fair international conditions, workers in the city-state will be the first to take a hit when times become tough.

However, with a slew of measures every year to make older workers more employable and prepare employers themselves for changing economic conditions, upskilling, reskilling, and accepting diversity of age and experience in the workforce are likely to become the new normal for both employers and employees: as they should in today’s fast-changing world.

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Topics: Skilling, #Budget2020

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