ASSESSMENT OF MANPOWER NEEDS

[Mr Speaker in the Chair]

Dr Tan Boon Wan asked the Minister for Manpower whether his Ministry has assessed the manpower needs of the country after the current regional crisis; whether there is any mismatch between what we have and what we will need; and, if so, what steps are being taken or planned to close this gap.

The Minister for Manpower (Dr Lee Boon Yang): Mr Speaker, Sir, the manpower situation has been affected by the current economic slow-down. More workers have been retrenched. The majority of jobs lost was in labour intensive and low-skill areas. On the other hand, new jobs created tend to be of higher value added and require higher level of skills. For example, in the manufacturing sector, the $8.5 billion of committed fixed asset investments will generate some 20,000 new jobs over the next few years. Most of these new investments such as wafer fab, petrochemical and telecommunications, require skilled workers with NTC certification. The demand for workers with technical and specialised skills includes more than 2,000 engineers, 2,000 diploma holders and 3,000 NTC II holders for this year.

In view of the shift in demand to higher skill jobs, we face a real danger of a mismatch in the skills required by the employers and what our workers can do. Structural unemployment will be the outcome if nothing is done. This problem must be tackled by retraining and skills upgrading, especially for the older workers. Hence, the Government has committed $50 million in addition to the Skills Development Fund's $50 million to expand the outreach of the Skills Redevelopment Programme which is targeted at upgrading workers' skills so that they can cope with the changes. Yesterday, the Minister for Finance announced another $20 million for a Skills Development Centre. The $120 million Skills Redevelopment Programme will be able to provide skills upgrading for up to 40,000 workers. If every worker makes a determined effort to raise his or her skill level, we will be able to close the gap and rid the consequences of structural unemployment.

Mr J. B. Jeyaretnam (Non-Constituency Member): May I ask the Minister how long has this retraining programme been in place?

Dr Lee Boon Yang: Mr Speaker, Sir, the Skills Redevelopment Programme was first launched in December 1996 under the auspices of the NTUC, the Singapore National Employers' Federation (SNEF) and the Government. Several Government departments or statutory boards were involved. EDB and PSB were very much involved in the pilot phase of this programme.

Mr Jeyaretnam: How is it, may I ask, that we still continue to have this gap between the skills needed and the skills that our workers can provide?

Dr Lee Boon Yang: Mr Speaker, Sir, we have quite a large number of older workers, aged 40 and above, who have less education because, in their younger days, education was not so freely and readily available. This is the group of workers that are most in need of skills upgrading. Skills upgrading needs a little bit more time. We cannot just wave a magic wand and overnight we have 400,000 or 500,000 workers who are suddenly turned into skilled workers. So although the Skills Redevelopment Programme was launched in December 1996, it will take us quite a few years to reach out to all the older workers to help them to upgrade.

Mr Simon S C Tay (Nominated Member): May I ask the Minister, besides the skills qualification, does the Government expect any mismatch in terms of the graduates from polytechnics and universities?

Dr Lee Boon Yang: Mr Speaker, Sir, this year's group of graduates may experience a more difficult time getting a job, and I have said before that some of the graduates who are too fastidious or waiting for the ideal job to come around may find that they have to wait quite a while. So the advice is that, for a new graduate entering the job market for the first time, whether he is a polytechnic graduate or a university graduate, he should try to get a job as soon as possible, regardless of what the offer is and, even if it is not his ideal job, it is still better to have a job and be employed and take the time to learn the ropes than to stay unemployed because the economic situation is not very good. There is a sharp slowdown in the economic growth. Many companies are not expanding their head count even at the higher end.

But having said that, there are still some sectors, whether it is in the manufacturing or service sector, which are still in need of more senior and experienced or even graduate employees, and these are the companies that will be recruiting. In some cases, they may even find that they have difficulty getting the number of skilled workers that they need from among our pool of graduates. For instance, in the manufacturing sector, like the wafer fab, which I mentioned earlier on, they have a very high demand for technicians and engineers whom we cannot completely meet with our own graduate output. Some of these companies may in fact still have to recruit foreign talent to supplement the domestic graduates who are joining the workforce at the moment.

Mr Simon Tay: Given that the Minister's advice is for some graduates not to be too fussy and that there will be shortfalls in others, I understand that there is a mismatch at least in the short term. If that is the case, will the Government relook at the intake into universities and polytechnics to cure the mismatch problem?

Dr Lee Boon Yang: Mr Speaker, Sir, in the long term, we expect to be short of talented and skilled manpower. So the Government's effort is towards increasing the supply of skilled manpower from our local manpower resources. We have a committee called Manpower 21 to look at the medium and longer term manpower planning to see how we can better meet the demands of various industries and to ensure that there will be sufficient output from our various institutions of higher learning to meet as much of the demand as possible. But for the longer term, with a small population of only three million people, and if we want to generate that kind of economic growth that we had been enjoying previously, my feeling is that we will always remain short of talent at the top end. That is why the Government is talking about trying to recruit international talent to supplement our domestic talent.