(Corrects 13 para to make clear Credit Suisse's jobs relocation
was made before new hiring rules were announced)
By Rujun Shen
SINGAPORE, July 31 Singapore risks tarnishing
its business-friendly reputation by implementing new labour laws
that require companies to prioritise hiring locals over
foreigners for middle income jobs, analysts say.
From Friday, large and medium-sized companies looking to
hire workers with a monthly salary below S$12,000 ($9,700) must
advertise the positions on a government-run online job database
that only Singapore citizens and permanent residents can apply
The job must stay open to locals for two weeks before the
company is allowed to seek foreign candidates.
Many multinational corporations, from Google and
Microsoft to Procter & Gamble and BP, use
Singapore as their regional headquarters, attracted by the city
state's political and economic stability, low taxes and ability
to attract talent from across Asia and the world.
Foreigners make up around 38 percent of Singapore's 3.4
million strong workforce and the new rules are the latest in a
series of government measures aimed at easing locals' worries
about the growing presence of foreigners on the tiny island.
Concerns about jobs were one of the most prominent issues
raised by voters at the 2011 general election, which was the
most contested since Singapore's independence. The ruling
People's Action Party share of the vote also slipped to around
60 percent from 67 percent in the previous election.
Economists said the foreign labour restrictions could
tarnish the city-state's reputation as an open and free economy.
"There is a risk that Singapore might slide down the scale
in terms of how open it is," said Chua Hak Bin, head of emerging
Asia economics at Bank of America Merrill Lynch in Singapore.
Ten of 12 recruitment agencies polled by Reuters said
filling vacancies has become tougher in the past year, a trend
set to continue.
"Singapore's very strict policy when it comes to hiring
foreigners will further exacerbate the skills shortage in
Singapore," said Chris Mead, regional director at recruitment
Several recruiters say they expect a rise in companies
moving certain departments offshore, with IT and manufacturing
the most likely sectors to be affected.
Deutsche Bank said in early 2013 that it was
considering moving more than 8,000 staff from offices in New
York, London, Hong Kong and Singapore to lower-cost locations.
Credit Suisse moved some back-office jobs from
Singapore to India and Poland in 2012, but this took place
before the new hiring rules were announced.
The aviation industry is also struggling with labour
shortages and higher hiring costs. "Manpower costs you today in
Singapore," said Barathan Pasupathi, CEO of budget airline
($1 = 1.2408 Singapore Dollars)
(Additional reporting by Caroline Ng, Anshuman Daga; Editing by
Rachel Armstrong and Miral Fahmy)