Singapore gripped by employment squeeze
By Sumathi Bala
Financial Times, January 15 2009
Singapore’s job market is looking gloomy as the global economic slowdown takes its toll on local industries’ hiring.
A recent survey reveals that more than half of bosses are planning to cut jobs in the first quarter of this year.
A Manpower employment outlook survey of 629 employers across seven industry sectors found that only 8 per cent intended to recruit, while 46 per cent expected to cut jobs. The rest had no plans to hire or fire, or had not made up their minds.
Net employment outlook – the percentage of employers looking to hire, minus those expecting a decrease in employment – now stands at 38 per cent for the January to March period, a sharp 54 per cent drop from the fourth quarter last year.
Job prospects are less bullish across Asia, according to the survey, with employers in all eight countries polled reporting weaker hiring plans compared with the previous quarter and a year ago.
The slowest hiring activity is expected in Singapore and Taiwan, where negative hiring expectations are reported.
Jeffrey A Joerres, chairman and chief executive of Manpower, says that the net employment outlooks from Singapore, India, Taiwan, Australia and New Zealand are the weakest recorded and contrast starkly with the previous year, when these markets “were dealing with chronic and widespread talent shortages”.
A recent Reuters poll reaffirms Singapore’s grim outlook. The city-state is expected to be Asia’s worst-performing economy next year, when it is likely to remain entrenched in recession as the global downturn erodes demand for its exports.
The poll predicts gross domestic product (GDP) will contract 1.1 per cent in 2009. That marks a rapid deterioration in the economic environment from two months ago, as the global financial crisis has deepened. A similar poll in late September forecast 4.6 per cent GDP growth.
Singapore’s bleak performance has been the result of its exposure to the US market. The city-state became one of the earliest casualties of the US credit meltdown in Asia, when it sank into recession in the third quarter of 2008.
Singapore’s openness to external trade – especially its manufacturing industry, which accounts for about a quarter of the economy – is expected to cause more suffering this year, as the downturn in advanced economies accelerates. Job losses in manufacturing will rise as a result, analysts say.
Local companies are beginning to feel the pinch. Neptune Orient Lines, one of the world’s largest container carriers, recently said it would lay off 1,000 employees or 9 per cent of its workforce and issued a profit warning.
In a sudden move, DBS group, the largest bank in south-east Asia, said it would cut 900 jobs, or 6 per cent of its staff, mostly in Singapore and Hong Kong. This, by far the biggest job cut it has made, is to reduce costs as it tries to run a tighter ship amid a challenging business environment.
Philippe Capsie, country manager of Manpower Singapore, says: “As the realisation of the credit crisis begins to hit companies, employers’ hiring confidence is likewise affected. We expect companies to monitor market developments closely before making hiring decisions.”
He adds: “Employers are likely to place a higher emphasis on retaining and retraining existing staff as well as paying more attention to productivity. A number of employers will continue to hire, but job seekers are advised to be more open-minded in their job search and expectations.”
As lay-offs are expected to mount, Singapore’s policymakers are urging companies to look at creative options, such as having a shorter working week and reducing year-end bonuses. To keep workers employable, the government has also launched a S$600m ($402m) training scheme, which gives employers more funds to retrain staff rather than dispense with them.
The economic crunch could also affect Singapore’s reliance on foreign workers. Lim Swee Say, secretary-general of the national trades union congress (NTUC), speaking at a recent forum, said that it may make more business sense to let go of foreign workers rather than Singaporean workers if retrenchment is unavoidable for companies.
“We’re talking about rank-and-file workers, who are, by and large, replaceable. Our message is: give priority to the local workers. Not only will you help minimise unemployment in Singapore, but more importantly, it makes business sense for your company.”
Mr Lim added that if Singaporeans are laid off, companies may find it tough to re-employ them when the economy improves, as they will be sought by companies that must fulfill a quota of locals before they can hire foreigners.
At the same time, it is not lost on policymakers that foreign workers are necessary for companies to keep costs down and to dissuade local operators from choosing to relocate overseas.
The unemployment rate is expected to be below 3 per cent with about 10,000 job losses this year. But some estimates paint a bleaker picture, predicting that job cuts could be higher than the 30,000 seen in the 1998 Asian financial crisis.
Rising costs strain Singapore's university students
By Fong Wei Li / National University of Singapore
UPI, Jan 14, 2009
Singapore, Jan. 14 (UPI) -- By day, a third-year economics major who wants to be known only as Lynn attends classes at the National University of Singapore, usually clad in a simple getup of jeans and a tank top.
But at night, while most other undergraduates are asleep, Lynn trades her casual wear for a wardrobe of resplendent dresses and works as a social escort, a job scorned and labeled distasteful by most. From 8 p.m. to about 4 a.m. she entertains male clients by attending functions with them, indulging them in a drink and chat, or by providing what she called “discreet services.”
“It’s not exactly the most glamorous of jobs,” Lynn said. “I’m keeping it from my parents and most friends. But what to do? I have to eat my meals and pay my bills.”
Lynn belongs to a handful of varsity students taking on part-time jobs to finance their tuition fees and daily expenses. These students usually come from lower-income families with parents who are unable to foot the steep bills tagged to a tertiary education. It is unclear how many such students there are, but like Lynn, some are holding jobs that involve long hours while others engage in menial labor. Some of these students say their grades have suffered from having to balance both work and studies.
Lynn's father, a truck driver, took a pay cut earlier in January and makes barely enough to sustain the household’s day-to-day expenses, let alone finance Lynn’s university education. To see herself through her degree, she has been juggling her studies with part-time jobs since she enrolled at NUS.
According to the NUS Office of Admission’s Web site, the estimated monthly living expenses for undergraduates range from $580 to $1,000. This includes costs for transport, food, course materials and personal expenses. Tuition fees for most undergraduate degree courses are currently pegged at $6,360 per year, a $250 increase from last year. Broken down on a per-month basis, tuition fees add $530 to a student’s monthly expenses. Including living expenses, an undergraduate requires between $1,110 and $1,530 a month.
Although NUS offers loans to students assessed as needy, the schemes cover only up to 90 percent of tuition fees and provide little or no relief on the side of living expenses. On the other hand, rising food and transport costs are jacking up the cost of living. “I used to spend about $450 a month, give or take,” said Jamie Ong, a second-year mathematics major. “Now, all the price increases have brought it up to about a little less than $550.”
Ong’s father was retrenched earlier in May, and her mother earns a nominal income as a dishwasher. Both parents refuse to fund her university education because they feel it is a waste of time and money. To make ends meet, Ong takes on an evening job at the Night Safari as a tram guide, working from 6 p.m. to 12 a.m. on weekends and alternate weekdays. She is paid $8 an hour and earns about $900 a month, half of which goes to her family. “On weekdays, I rush off from school to Night Safari and work till midnight,” Ong said. “It’s darn tiring and I feel like I can’t get any schoolwork done on time.”
Third-year psychology major Benjamin Kuah works part time as a supermarket assistant to finance his varsity life. His job at the supermarket is physically tiring because it requires him to carry and move heavy boxes daily during restocking. Kuah’s father was diagnosed with schizophrenia years ago and has since been unable to work. His mother supports the family with her job as a school cleaner. Kuah attributed the plight of needy students, who work part time, to inadequate financial support. “I’m on the assistance scheme and they gave me a loan for most of my tuition fees but there’s no help with my living expenses,” Kuah said. “I’m not a big spender but I still need to eat, travel and pay for miscellaneous stuff. That’s the hard part.”
Eunice Foo, an officer with the NUS Office of Admissions, said the university’s assistance schemes assess each applicant and provide aid based on individual needs and circumstances. She said to help students cope with living expenses, the university’s career center facilitates work-study arrangements by maintaining a comprehensive job bank.
Kuah said this does not solve his problem of having to plough long hours and late nights into his supermarket job just to make ends meet. He added that his grades have suffered since he took up the job one year ago. “When I was in year one, my CAP (cumulative average point) score was above four,” Kuah said. “Now it’s below 3.5.” Ong, who works at the Night Safari, said her grades have also worsened noticeably. "I skip class so often because I'm so tired I can't wake up in time," she said. "If I manage to go for class, I end up falling asleep."
Lynn, who works as a social escort, said the nature of her job leaves her no time for schoolwork. “I usually can’t meet deadlines and sometimes I flunk modules,” she said. “But it’s better than not being able to afford my degree and then having to sell myself for the rest of my life.”
Not the time to flaunt your riches
Insight Down South
By SEAH CHIANG NEE
Jan 10, 2009
A high-ranking civil servant’s account about spending RM110,124 for him, his wife and son to learn fine French cooking has blown up in his face.
A GOVERNMENT elite has stirred ripples by talking of his expensive cooking lessons in France, revealing how hard times are deepening class differences in Singapore.
Inadvertently creating controversy was the permanent secretary at the Environment and Water Resources Ministry, one of the highest ranking civil servants.
Tan Yong Soon had related how he had spent S$46,000 (RM110,124) for himself, his wife and son for a five-day trip to learn fine French cooking.
In ordinary times, this leisurely – but rather insensitive – account would not have amounted to anything much but these days are, of course, far from normal.
Two factors invited criticism to flare.
First, he was seen as flaunting wealth, obtained from his high pay, at a time when Singapore is suffering one of its worst slumps in history.
Many thousands of workers are still losing jobs or suffering wage cuts.
And, secondly, government leaders are accused of being hugely overpaid, as a result of which some are no longer able to relate to the common people.
Tan was also accused of “boasting” about his elitist background when he wrote that his wife was “a senior investment counsellor at a bank” and his son, a soon-to-be student at America’s prestigious Brown University.
“Taking five weeks’ leave from work is not as difficult as one thinks,” Tan said.
“Most times, when you are at the top, you think you are indispensable. But if you are a good leader who has built up a good team, it is possible to go away for five weeks or even longer.”
Singaporeans were largely unimpressed. Some were angry. His fling at France’s prestigious Le Cordon Bleu in the face of rising poverty is the latest example of how out of tune some of Singapore’s well-paid elites are with heartland realities.
About 20% of affluent Singapore’s population lives in poverty with welfare payout to the poorest of the lot limited to a mere S$290 (RM694) a month.
When a government backbencher wanted to have it increased, a Cabinet minister refused, demanding: “How much do you want?”
Many Singaporeans were already unhappy with the multi-million dollar salaries paid to Cabinet ministers and top civil servants even in happier times.
(Despite a recent cut of up to 19%, the government here remains, by far, the highest paid in the world.)
The pay issue remains very controversial and contributes to the class division in society, a them-verses-us mentality that has apparently sharpened as a result of the economic crisis.
The whole episode has shown how the class – and social – divide is widening in high-tech Singapore.
The controversy over Tan’s trip has political implications for a government that is pondering over whether or not to call for a snap general election, which is not due until 2010-11.
In other developed countries from Britain to Japan, it would not have any impact since it involves a civil servant, not a political leader.
But the system is very different in Singapore, where the line separating the two hardly exists.
The Chinese characters “zeng fu” are used to describe the political leadership as well as the civil service.
Some questioned why Tan’s choice of spending his own wealth should be the public’s business – but not many are buying into it.
Established blogger Redbean articulated: “Tan is no ordinary, rich Singaporean. He is a senior civil servant ... and part of the governing elite.
“(He) should be seen as one who would be able to empathise with ordinary Singaporeans who are going through tough times ... (when) the Prime Minister is preparing the people for some belt-tightening and ‘bitter medicine’.”
Besides, if Tan had wished he should have spent his money at home to help the troubled economy rather than abroad, some believed.
Tan’s is by no means the only example of elitist snobbery, nor the worse.
A bigger controversy flared up four years ago when Wee Shu Min, the teenage daughter of a Member of Parliament, came across the blog of a Singaporean who wrote that he was worried about losing his job.
She called Derek Wee “one of many wretched, under-motivated, over-assuming leeches in our country.
“If you’re not good enough, life will kick you in the b***s ... Our society is, I quote, ‘far too survival of fittest’,” said Shu Min, who hailed from the elite Raffles Junior College.
“... Unless you are an arm-twisting commie bully, which, given your whiny, middle-class, under-educated penchant, I doubt,” she added before signing off with “please, get out of my elite uncaring face”.
The girl was flamed by hundreds of Singaporeans, but when her father Wee Siew Kim – an MP in Prime Minister Lee Hsien Loong’s constituency – told a newspaper that “her basic point is reasonable”, the row moved well beyond blogosphere.
A news agency, in reporting this, said: “The episode highlighted a deep rift in Singapore society and was an embarrassment for the ruling People’s Action Party and PM Lee.”
Raffles JC, which has produced several state leaders, had another brush with student snobbishness.
When a student found that a Raffles girl was dating a boy from a lower-achieving neighbourhood school, he hit out at him and had a message for lower-ranking students everywhere.
“Quit trying to climb the social ladder by dating students from top schools.”
There are signs the class distinction is getting into some young minds.
A reporter recounted how her friend was shaken when her young daughter came home one day and mentioned in passing that poor people were “stupid, obviously”.
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