Singapore budget puts focus on technology
Tighter foreign manpower policy for the services sector calls for more technology in Singaporean firms
Singapore has recently released its budget for 2019 and while there were a number of initiatives highlighted, one stood out in particular. The budget announced that the Dependency Ratio Ceiling (DRC) for the services sector will be cut from 40% to 38%, before being further reduced to 35%. This means that firms in many industries will need to hire fewer foreign workers as a proportion of their workforce.
One of the goals of the 2019 budget, outlined by Singapore Finance Minister Heng Swee Keat, was to build ‘deep-enterprise capabilities, deep worker capabilities and encouraging strong partnerships within Singapore and across the world’. By forcing firms to reduce their dependency on labour they are encouraging a deeper investment in technology.
This makes a lot of sense. For a company like Everise, with over 12,000 digitally enabled employees around the world, we understand what effects both government policy and technology have on employment habits and manpower.
While the Singapore budget’s manpower restrictions may largely affect the services sector – for example, F&B, hospitality etc – this should be a wake-up call to the rest of the economy and companies need to take the right lessons from this.
Firstly, there is a push towards a higher value economy and this starts with the workforce. Employees will need to demonstrate higher aptitude and abilities before being hired and will need to fill a genuine need.
Secondly, technology will play an important role. For obvious reasons humans cannot be completely replaced by machines, and even though there is fear around automation, much of this fear is misplaced. Automation and technology will create many more jobs and careers than it disrupts.
However, in order to survive in an economy that has a tight labour market, companies will need to invest in technology that will empower their existing employees, not replace them. For example, AI solutions that draws disparate pieces of information from multiple sources and presents them to the employee in an organised fashion.
This both saves significant time for the employee and most importantly allows that employee to do even more with less. This not only results in better productivity, but actually makes firms more competitive and able despite having (potentially) fewer or the same number of employees.
As a player in the BPO industry we made the decision to bring on technology years ago and have since partnered with Microsoft and acquired APAC’s leading Conversational AI company, Hyperlab, which enable our employees to do even more. Hopefully we will see the same over the coming years in Singapore.