Is the introduction of foreign talent in Singapore beneficial to Singaporeans?

[The Suede Times] Impact of Foreign Talent

Gautam Banerjee is the type of foreigner Singapore wants to attract. The Indian-born accountant left London after university in the early 1980s and moved to the city-state, where he became a citizen in 1990.

Now the head of PwCAsia, he was appointed by the government to serve as a non-voting parliamentary member to promote the interests of Singapore's growing immigrant population. "We need to get overseas talent to sink roots here," he says.

Singapore wants a lot more people like Mr Banerjee. Its birth rate, once one of world's highest, is flagging. Young, educated Singaporeans are emigrating to seek better-paying jobs or more freedom from restrictive rules at home. If present trends continue, the local population could begin to shrink by 2020.

Singapore's leaders view the situation with alarm. A declining population would result in economic stagnation. Their solution is to admit many more foreigners with the goal of increasing the population to 6.5m from 4.5m in the next 20 years.

The main focus: attracting skilled workers from China and India, the countries that provided the waves of immigrants who helped to turn Singapore from a 19th-century swamp into the financial centre it is now.

If foreign-born permanent residents are included, Singapore has Asia's largest population of foreigners as a proportion of its residents. They make up more than a quarter of its population and a third of the workforce. Since 1990 the foreign population has expanded by 7.4 per cent annually to 1.2m against a 1.1 per cent rise for all Singaporeans.

While Singapore seeks to lure skilled workers with an eye to the future and competing with rival Hong Kong, the reality is that most of those who have arrived in recent years are a rotating underclass of cheap labour from the Philippines, Indonesia and Bangladesh.

Of the 670,000 foreigners working in Singapore, 87 per cent are employed in low-paid jobs as construction workers or domestic maids.

As the government chases skilled workers, "state policy is opposed to long-term immigration [of unskilled foreign workers] and directed at ensuring that this category of migrants remains a transient workforce", says Brenda Yeoh, a geographer at the National University of Singapore.

Maids and labourers normally receive work permits for one or two years, cannot bring in spouses or children, are forbidden from marrying Singaporeans and are deported if they are pregnant.

The government is hoping to change the foreign population mix by attracting more educated workers needed to fill jobs in service sectors such as private banking and finance, biotechnology and education. It wants many of them to become citizens or permanent residents, with the goal of having 240,000 of them gain this status in the next five years.

To do so, the government is trying hard to shed Singapore's dull image in favour of a global city with buzz. It has eased strict rules governing nightlife and will soon open two of the world's most expensive casinos. The development of cultural activities, is receiving attention after years of neglect. "Singapore is selling itself as a lifestyle centre" to attract more middle-class workers, says Christine Ong, the Singapore country head for UBS, the investment bank.

The focus on foreign talent has provoked a backlash, with the income gap widening to its greatest since independence in 1965. A newspaper poll found 43 per cent of Singaporeans believed the government cared more about foreign professionals than the local population, with their biggest worry the loss of jobs to outsiders.

Officials say the influx will help job creation by developing service industries and start-up companies that can hire local workers. But some economists suggest that Singapore should cut the number of low-skilled foreigners to promote local hirings and higher wages. As one of the most densely populated countries, the addition of 2m people threatens to strain resources.

It is likely to increase Singapore's dependence on imported food and water, while raising prices for housing, transport and public services that would undermine the government's strategy of making the city-state cost competitive. Housing prices, for example, are already expected to go up 30 per cent this year while rents for office space in the prime business district have doubled in the past year.

The biggest challenge that Singapore may face in the long term is to maintain the social stability that the government has always prized. "Foreign labour policies might be tightened if political stress emerges in the future," says Chua Hak Bin, regional economist at Citigroup in Singapore. "Such a risk cannot be dismissed as foreigners could reach half of the total population."

Prime Minister Lee Hsien Loong mentioned two years ago that “if we want our economy to grow, if we want to be strong internationally, then we need a growing population.” In other words, the population of Singapore needs to be large enough to ensure that economy can grow. However, statistics have shown that last year, the number of citizen births rose by a mere 0.9%, or an average of 28,000 births per year. So, the other option will be to introduce foreign talents into Singapore. The foreign talent policy has since caused much discussion among Singapore citizens. I certainly agree that foreign talents are beneficial to Singaporeans. Foreign talents refer to those who have achievements or skilled in bio-medicine research, technology and other related jobs as well as those who come to our tertiary institutions to impart their knowledge to our students. Students with great potential migrating to Singapore to study can also be considered as “foreign talents”. Those who have migrated to Singapore working as clerks, store assistants, secretaries, etc. are not considered foreign talents. They are considered as “foreign workers”.

Foreign talents are definitely helpful to Singaporeans. Foreign talents add value to the Singapore’s workforce and can even exchange valuable knowledge and experiences they have obtained in their hometown or other places with our local expertise. This co-operation with our local workforce can definitely help to improve the efficiency of the workforce and thus help to improve Singapore’s economic. The foreign talent can also transports the technique they use in their homeland and adapt it in Singapore, making Singapore more competitive compared to other countries. Also, as these foreign talents normally migrate to Singapore from places where it is poorer, the living conditions are not that good and they could not find a suitable job, they often tend to settle for lower pay unlike locals. This can help to slow down the demand for higher wages and through this, it helps to keep the economic competitive.

Besides economic increase, foreign talents also bring with them their culture when they migrate to Singapore. As Singapore is a country with many cultures and a crossroad of the east and the west, these new cultures brought here by the foreigners will definitely merge into the society. With cultures from around the world, Singapore can really be considered as a global city as there are people of different origins living side by side of each other.

Despite all these benefits, many are still not convinced that foreign talent will benefit the locals and aid in Singapore’s economy. Singaporeans feels threatened by these foreign talents ...

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Despite all these benefits, many are still not convinced that foreign talent will benefit the locals and aid in Singapore’s economy. Singaporeans feels threatened by these foreign talents as they tend to be at a disadvantage when compared to those foreign talents. For example, Singaporeans have other duties besides that of work, including those locals with great talents. Thus, they are unable to work overtime whereas foreign talents are willing to. This disadvantage, as claimed by many locals, can cause them difficulties when looking for a job. Even students mention that they have difficulties in obtaining scholarships as those foreign talents often do very well. This is completely unjustified; as long as there is fair competition and no rampant undercutting of wages resulting in overall decline in welfare, there is no reason to feel threatened by foreigners. Foreign talents may indeed be more hardworking and less demanding with good attitude, locals also have their own advantages: They are able to pick up things faster than foreigners. As such, locals’ fear of foreign talents taking away their jobs are unjustified.

In conclusion, the introduction of foreign talents brings more benefits than harm to Singaporeans and Singapore’s economy. Although foreign talents do indeed have certain advantages, it does not mean that they have no disadvantages. Thus, locals do not have to fear about foreign talents taking away their chances of employment or scholarships. Therefore, the introduction of foreign talent in Singapore is beneficial to Singaporeans.

Do Foreign Talents Have A Positive Impact On Your Society?

It is a known fact that Singapore does not have any natural resources. The only resource that it has is her people. Unfortunately, even that source is dwindling. With birth rates getting lower and lower, the government has to look for alternatives, which it sees in foreign talent. Foreign talent refers to people with high qualifications, experience, highly paid, able in various fields, for example, music, sports, enterprise. Although the recruitment of foreign talent does have its demerits, these are outweighed by the positive impact it has bought about in our society. Thus, I personally feel that foreign talent bring about a positive impact on our society.

The first point to show that foreign talent leave a positive impact on our society is that they bring in skills that Singaporeans do not have. With only 83 engineers and research and development experts for every 10,000 workers, Singapore is trying to produce more quickly but many are still needed from abroad for jobs such as neurosurgeons, software designers, bankers, researchers and engineers. There is a trend in recent years showing that Singaporeans are not interested in engineering courses and thus engineering courses are increasingly becoming unpopular. In contrast, foreigners from India and China usually take up such courses and occupations as they are deemed of high status in their own country. On the other hand, rare talents inSingapore like specialised doctors and neurosurgeons are bought in to compensate for the lack of that occupation in Singaporeans. Hence because of the rare skills that they bring in with them, foreign talent therefore leaves a positive impact on our society.

The second point to show that foreign talent leave a positive impact in Singapore is that they bring in different culture and thus diversify Singapore further. Through them, we get to learn about cultures that we have not really heard of and therefore they broaden our minds. This is good as in the global world, it is necessary for us to know other cultures to deal better with economic issues. This leads us to another point that they create jobs for us. Hence, because of the cultural and economical benefits that foreign talents bring into Singapore, they leave a positive impact on our society.

The third point to show that foreign talent bring about a positive impact on our society is that they increase our population, which has not reached its optimum replacement level. Thus, they strengthen our workforce by coming here. Furthermore, when foreign talents choose to settle down in Singaporeand form their own family here, they help Singapore in increasing its birth rate. Hence, because they increase the population and strengthen our workforce, they leave a positive impact on our society.

Based on the points given above, I feel that foreign talent leave a positive impact on our society. However, there are some who disagree. They claim that foreign talent leave a negative impact on our society. Unfortunately, this view is too myopic. In the next few paragraphs, I shall examine their claims and the limitations.

The first reason given by those who claim that foreign talent leave a negative impact on our society is that they create competition with the locals in terms of education. Singapore has only four government universities. It already seems hard to enter them with so many candidates and such high requirements and with so many foreigners streaming in and taking up our places; the problem is only getting worse. Although, there are other options available like private universities and overseas education, it seems redundant to leave your country and study abroad because foreigners are taking up our places. Furthermore, they are usually to expensive for a middle-class family to afford. Hence, because of the competition they create in education, some people believe that that foreign talent leaves a negative impact on our society. However, this is too myopic a view. Singapore has always practised meritocracy. Therefore, everyone is given an equal chance. If we think deeper into the issue, it can actually be taken as that foreign talent make Singaporeans work harder toward achieving their goals. Therefore, it only improves our society as it pushes us forward and makes each generation only smarter and wiser. Hence, foreign talent leave a positive impact on our society as they improve our society.

The second reason given by those who claim that foreign talent leave a negative impact on our society is that they create competition in the work force. Employers prefer to employ foreigners compared to Singaporeans as they are deemed more creative and better team player. They are also considered more hardworking than Singaporeans. This reduces the job opportunities of Singaporeans. Hence, some people believe that foreign talent leave a negative impact on our society as they snatch away our job. However, this is too myopic a view. As I have mentioned earlier, Singaporeans are not interested in engineering courses and thus engineering courses are increasingly becoming unpopular. In contrast, foreigners from India and China usually take up such courses and occupations as they are deemed of high status in their own country. Hence, foreign talent leave a positive impact on our society as they take up jobs that Singaporean do not really want to do.

In conclusion, foreign talent leave a positive impact on our society. Thus, we must work together to ensure that they are fully utilised to benefit our nation as a whole.

Do we really need foreigners? Or can they actually help Singapore achieve new heights?

Whilst many of us youth in Singapore may have already had considerable interaction with at least some foreigners amongst us, it is likely that many of us have not took time out to critically consider their contributions to our society. Are they really, according to some Singaporeans, simply here to procure our scarce job opportunities? Does their existence on our island-country benefit us in any way?

Well, in fact the answer is pretty clear. Yes and no. It is an undeniable fact that the foreigners who have forgone their own countries for greener pastures like ours, are here to look for jobs. However, it is certainly most unapt to label them as “the-ones-snatching-our-rice-bowls”. If you are one to have such an opinion, then you ought to be asking yourself the following questions: With increasing affluence in Singapore, would most Singaporeans be willing to take up menial work? Is hard work and knowledge enough to bring our economy forward in the Creative Economy of tomorrow?

The picture should be clear by now that foreigners do open up more avenues for us. Women are able to relieve some of their family burdens to look for more satisfying jobs. A boost of creative and out-of-the-box thinking can now ensure that Singapore grows from strength to strength amongst the superpowers and emerging economies of the world.

There is a simple reason behind the government’s persistence and belief in the power of foreign talent. As civic-minded Singaporeans, we should always be mindful of the greater benefits to the public and not have myopic views on national issues. As long as the foreigner numbers are capped at an appropriate percentage, we should be looking forward to a bright future ahead.

As promised- although one day late, I will try to say something on the topic of foreign talent in Singapore. In my previous post, I mentioned that Singapore was raising the retirement age. One of the reason for doing so, besides making senior citizens in Singapore self sufficient and not lapsing into dependency mode (the top most fear of the current government in Singapore) is because there is a pressing need for labour.

With the birth rate still languishing and hovering around or below the replacement rate, the government's options is to import even more foreign talent and/or to raise the retirement age so that workers in Singapore can still contribute another 5 years or more. The Singapore government has stated before that the issue of foreign talent is a matter of life and death. In reports that I have read on the internet published by academics, they have mentioned that around 2-2.5% of Singapore's GDP growth in the 1990s is due to foreign talent. So that is around a quarter or more of Singapore's growth being directly attributed to foreign talent. And that was before the government opened the gates even wider to welcome foreign talent.

The average Singaporean will probably not have any strong views on these foreign talent. I dare say that all companies in Singapore have some foreign talent from the education sector (some teachers in Singapore hail from foreign shores too) to the banks to the construction industry. You see them all the time, everyday of the week. Resentment surfaced when there was a recession in the 1997 Asian Financial Crisis and the meltdown in the markets in the first few years of the 21st Century. People viewed these foreign talent as people who are taking away jobs of the local Singaporeans.

The economic answer to the resentment is using the economic magic word- multiplier effect. Like the economic answer to whether protectionist policies helps or hinder a country, the multiplier effect is rather ingenious. Basically it says that $1 spent in the economy multiplies many times. So if you spend $1 to buy say some small items, the grocer who receives this $1 may spend it to buy newspaper, and the newspaper vendor uses it to buy something else. In short, the $1 has this multiplying effect on Singapore's economy.

So, how does it relate back to the foreign talent? The simple answer is that each and every foreign talent has a multiplying effect on Singapore's economy. They work here, they earn money and they spend a large part of this money they earned back into Singapore's economy. Thus, the Little India Jewellery store owner's smile is a little wider because of the effect of foreign talent on the store. The owner will spread a little of this multiplying effect to maybe hire a new assistant to manage the booming business. The owner will also spend part of this money to consume goods and services. Therefore, in this little example, you can see that there is actually also job creation from the hiring of foreign talent.

Now that you are having nice and positive thoughts about foreign talent, you notice that the title says 'bane' too. So where is the flip side? Foreign talent increases labour supply. As any half baked student who studies economics will tell you, increasing the supply means that the prices of labour goes down. Foreign talent reduces wages on average. As employers have more options, the labour costs goes down and your wages either stagnates or goes down with more foreign talent.

After hearing this, a lot of people will flip and say, good riddance to foreign talent. We don't need them. However, this movement of foreign talent from country to country is a shift that cannot be prevented. If we prevent this, they go to another country to contribute there and grow that country's economy. In the end, when our labour costs go through the roof, we lose our competitiveness and the companies who have invested here go where labour costs are lower. In case I haven't bore you with this long post, you can read this illuminating article from a prominent economist from Deutsche Bank about Singapore future (his name sounds like he is also a foreign talent-apt for this particular post)