Retrenchments in Singapore as Economy Slows in 2012

Ms Ellen Lee asked the Deputy Prime Minister and Minister for Manpower (a) since the beginning of 2012, whether the Ministry has received any notification of possible retrenchments of Singaporean and non-Singaporean workers in view of the much expected slower growth this year; (b) if so, which industries are the retrenchments taking place in; (c) what are the expected numbers of Singaporeans and non-Singaporeans who will be affected; and (d) what plans does the Ministry have to help retrenched Singaporean workers.

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The Minister of State for Manpower (BG [NS] Tan Chuan-Jin) (for the Deputy Prime Minister and Minister for Manpower): Sir, in January 2012, the Ministry of Manpower (MOM) received 22 notifications from employers on prospective retrenchments. About two-thirds of these planned retrenchments were in the services sector and one-third in manufacturing. Some 230 workers − about 60% of whom are residents − are expected to be affected. As these notifications are provided by employers on a voluntary basis, the actual numbers of retrenchments and affected workers could be higher.

Based on this feedback, there is no indication yet that the number of workers facing retrenchment has gone up sharply. The proportion of residents retrenched, based on the notifications, is also comparable to the proportion of residents employed in our workforce.

MOM is nevertheless watching the retrenchment situation closely. While our employment numbers are very strong, and unemployment is low, we do fully understand what the individuals go through when retrenched; hence, the need to do what we can to minimise retrenchments, to ensure good employment opportunities and to step in to help when it does happen. For example, during the last downturn in 2008/2009, the Government, in close collaboration with our tripartite partners, introduced several measures to help companies alleviate the situation, including ways to help them manage their workforce flexibly, instead of resorting to retrenchment. These measures help keep many Singaporeans in their jobs. If the need arises, we will once again be prepared.

Where retrenchments are inevitable, companies should carry out such exercises responsibly. This includes providing affected workers retrenchment benefits where possible, to help tide them over when they are searching for employment. Companies are strongly encouraged to notify MOM of any impending retrenchments early so that we can work closely with the Work Development Agency (WDA) and the Employment and Employability Institute (e2i) to provide employment assistance or retraining to the workers affected as well as to help facilitate their transition to new employment.

Ms Ellen Lee (Sembawang): I thank the Minister of State for the reply. I would like to know whether MOM intends to make the notification by employers compulsory, because there will always be retrenchments taking place suddenly without any notice and leaving the most vulnerable group open to all sorts of consequences because of that.

BG [NS] Tan Chuan-Jin: As of now, there are no plans to make this compulsory. We have found over the preceding years that the way in which we interact with employers has been fairly constructive. We do acknowledge that sometimes retrenchment does happen out of the blue. What we try to do is to step in as much as possible, working with the unions, the employers and particularly with WDA, in terms of retraining, and with WDA and e2i, in terms of job placement. But this is a suggestion that we can look at, as to how we can improve the system.

Mr Yeo Guat Kwang (Ang Mo Kio): Among the numbers being retrenched, does MOM see that nowadays, more of those from the non-rank-and-file, that is, the PMETs, are affected?

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BG [NS] Tan Chuan-Jin: Based on the figures that we have, the PMETs today comprise about 52% of the workforce. And based on the retrenchment numbers, the number of PMETs that have been retrenched tallied pretty much with the proportion of the workforce. So, there is no particular trend in terms of PMETs being predisposed to retrenchments.

Dr Lim Wee Kiak: Sir, I would like to ask the Minister of State this: of those who were retrenched, what was the average duration before they were re-employed? If they were re-employed, what percentage of them got back about the same pay that they had, and what percentage of them accepted a lower pay?

BG [NS] Tan Chuan-Jin: I thank the Member for his questions. We will provide the Member with the specific details. I do not have the numbers offhand. But what we try to do is to provide retraining. In terms of job placement, obviously, we are unable to place everyone.