Singapore Manpower Ministry (MOM) raised salary thresholds for foreign professionals and skilled workers

The recent move by the Manpower Ministry (MOM) to raise the salary thresholds for foreign professionals and skilled workers may do little to quell demand for these workers.

From 1 July, for professionals, the qualifying salary thresholds for the three categories of Employment Pass holders will be raised respectively —

• Q1 = S$2,800
• P2 = S$4,000 
• P1 = S$8,000

For skilled workers, to qualify for an S—Pass, an applicant’s monthly salary will have to be S$2,000 or more, up from S$1,800.

MOM said the changes were made to keep pace with increases in locals’ wages and to encourage companies to be more selective when hiring foreign talent.

The higher salary thresholds were also introduced in response to concerns from Singaporeans that foreign talent is competing with them for jobs.

PrimeStaff Management Services has a number of S—Pass and Employment Pass workers on its payroll. It said the move to raise their salary thresholds will not have a big impact.

Ronald Lee, managing director of PrimeStaff Management Services, said: "When you hire, you don’t look at people just coming at the minimum level. You look at people who fit the requirements and these people who fit the requirements could already be earning $3,000, $4,000 or $5,000. So, if you really want to hire them, that is the kind of range you’ve got to be paying them."

Recruitment companies say clients still prefer to fill their positions with local workers. However, this may sometimes be a challenge. This is because local workers still demand much more, like in terms of salary expectations.

PrimeStaff Management Services’ Mr Lee said: "They would expect a very, very high package to entice them....Therefore, we have no choice but to look (at) outside (sources). There are also a lot of equally qualified foreigners who are keen to come at a lower salary, and these foreigners are generally more committed and they have a higher staying power."

The tight labour market is also making it tough to hire.

Phillip Overmyer, chief executive of Singapore International Chamber of Commerce, said: "(In) Singapore, if you look at the (labour) market, it is fully booked! Everybody is employed, more or less. So if the economy wants to grow, you have to hire other people."