SINGAPORE as the financial nerve centre of Southeast Asia has long been a magnet for multinationals looking to set up their Asia Pacific headquarters outside of China.
Strategically located, economically vibrant and innovation-driven, it’s no wonder why it draws investor attention.
But the tiny island nation has a massive problem.
By 2028, one-fifth (20.6 percent) of Singapore’s current full-time employees will have their jobs displaced, according to figures released last month at the World Economic Forum (WEF) on Asean gathering in Hanoi. Put into context, this means one out of every five employed Singaporeans could be out of a job in 10 years.
The figure isn’t as alarming for the region’s emerging economies. Estimates in the report by Cisco and Oxford Economics said the same fate will befall only 13.8 percent of the Vietnamese workforce, 11.9 percent of Thailand’s, 10.1 percent of the Philippines’, 8.1 percent of Indonesia’s and 7.4 percent of Malaysia’s.
So why is Singapore the hardest hit?
A closer look at the problem shows a glaring mismatch between available skills and the jobs created by Singapore’s burgeoning tech-driven industries. As the study pointed out, Singapore is “close to the frontier of technological progress”, with efforts towards digital transformation taking place at a rate much faster than its regional neighbours.
In 2014, the Singapore government launched its Smart Nation initiative, which aims to transform the island state through the adoption of new and emerging technologies. As part of the initiative to drive transformation, the government rolled out a series of plans; ie. the Digital Economy Framework for Action, the Digital Government Blueprint and the Digital Readiness Blueprint.
That aside, under the Communications and Information Ministry, the Committee on the Future Economy (CFE) convened on January 2016 with instructions from Prime Minister Lee Hsien Loong to develop economic strategies for the next decade.
In its maiden report last year, the committee outlined seven strategies to maximise Singapore’s potential to be at the forefront of technological progress in the region. Among others, these include improving Singapore’s international connections; upskilling Singaporeans to help them meet labour market needs of the future; and getting local enterprises to innovate and scale up.
Separately, the Economic Development Board last November launched the Singapore Smart Industry Readiness Index, a world-first tool developed to help SMEs and MNCs across all industries become Industry 4.0-ready.
In short, Singapore envisions a digital-first future, with every stakeholder from businesses to government leaders and society in general keeping up with the demands of the other.
But these plans take time to come into fruition, and as the Cisco and Oxford Economics study, and numerous other job market reports show, there’s already an urgent and immediate need to plug a major talent gap in the market.
A case of beer budget and champagne dreams?
Recent research by Robert Half Singapore said 93 percent of IT leaders in the country are concerned by the lack of available IT talent in the market to implement Singapore’s Smart Nation goals.
This is despite the majority saying Smart Nation is a blessing to the local IT employment market; 60 percent expect an increase in job opportunities and 53 percent anticipate the average IT worker’s salary would go up.
Staffing Industry Analysts pointed out, however, that to support, manage and maintain the deployment of new technologies, businesses need highly-skilled IT professionals, which the current labour market lacks.
Nearly nine in 10 Chief Information Officers (CIOs) interviewed said they struggled to find qualified IT professionals. A little over eight in 10 said it was even more challenging to attract IT talent to their organisations.
An analysis of technology job postings released Tuesday by job search site Indeed answers why.
Job seekers aren’t looking for technology roles
According to Indeed, although job postings for roles in cybersecurity, data science, machine learning and robotics increased by up to 700 percent over the past two years, this has not corresponded with an increase in job searches.
The greatest mismatch lies in cybersecurity, with “negligible” growth observed in searches despite job postings increasing by 500 percent.
Searches for roles in machine learning and data analytics have increased, however, going up a notable 139 percent and 48 percent respectively. But the increase in interest is nowhere near the growth in demand, Indeed found.
The number of available jobs in machine learning grew 300 percent while demand for data analytics experts, no surprises, exploded with 700 percent more postings in the two-year period.
Interestingly, the robotics sector bucks the trend. Increase in interest for the sector surpassed that of jobs availability with 64 percent looking for related roles while job postings only increased by 30 percent.
This shows the talent gap in robotics is closing, said Indeed.
The way forward
Robert Half Singapore’s managing director Matthieu Imbert-Bouchard said for Smart Nation to succeed, the talent shortage must be addressed.
“As the demand for top IT skills continues to increase in Singapore, a more comprehensive approach will be required to close the current and future technology skills gap,” he said in SIA’s report.
“Educational institutions should be encouraged to work with the business community and government to build a more robust business and technology ecosystem that develops and nurtures more talented IT professionals within the local talent pool.”
Indeed’s Asia Pacific senior director Andrew McGlinchey echoed the sentiment:
“Businesses, educators, and governments should make every effort they can to encourage talent in these areas and grow a diverse technology talent pool so that Singapore can continue to progress as a technology leader in Asean.”
According to Singapore’s Education Minister Ong Ye Kung, the local education system holds the key to addressing the nation’s labour and economic transformation needs.
But as we said earlier, these are plans for the longer term that will take time.
For now, Ong said Singapore needs to bring in foreign talent. The island nation will maintain little restriction in the recruitment of foreigners to fill high-end jobs in areas like artificial intelligence while a quota system for lower-skilled industries will continue, a Bloomberg report said last month.
“Talent is very short everywhere in the world – AI talent, software programmers,” Ong said in the Bloomberg interview. “We let them (foreigners) in because we require a critical mass for the sector to take off, while we continue to train Singaporeans for those jobs.”
Creating a pull factor
Technology firms, meanwhile, are beefing up their recruitment strategies with new methods to secure the kind of talent they need.
One such method, said Robert Walters Singapore’s managing director Rob Bryson, is by drumming up interest in the industry itself and showcasing to potential hires the opportunities that come with a role in technology.
“Technology is constantly evolving and the best tech talents know that unless they continually up-skill and improve themselves, they will quickly be left behind.
“As such, remuneration, while certainly an important consideration, is often not the final deciding factor – the learning opportunities are,” he said.
Companies like Razer, Ubisoft and Grab, for example, place great emphasis on work culture, the kind of cutting-edge technologies they use and opportunities for growth and innovation within their organisations.
Bryson said some firms hire talents on an interim basis, allowing these contract workers to work on projects – a win-win for both employer and employee. Employers need not worry about increasing headcounts and the interim hire could provide the necessary training and expertise for the firm’s existing team.
And if a hire is particularly skilful, the firm could then make him or her a permanent offer.
Finally, in view of existing shortages in the labour market, firms are also shopping for talents outside Singapore.
Grab, for example, last year hired Theo Vassilakis, a former Google and Microsoft employee based in the US, as Chief Technology Officer to head and grow its tech teams.
The benefits of hiring foreign talent is two-fold, said Bryson. “Bringing in talent from outside Singapore not only helps fill the resource gap, but also allows companies to inject experience and perspectives from outside of the country,” he pointed out.
Companies should also consider tapping Singaporean talents currently working outside the country., he said. Their international work experience and understanding of foreign cultures would come to be an invaluable asset, especially in technology companies.
Ultimately these strategies, rolled out alongside government initiatives like the Smart Nation programme, education and training opportunities for young Singaporeans, form the bedrock of Singapore’s efforts in plugging its talent shortage as labour requirements shift.
Cisco Southeast Asia president Naveen Menon said, however, that governments must also ensure that in upskilling its labour force, the emphasis must extend beyond just acquiring technical knowledge.
The key is to ensure flexibility by equipping workers with transferable skills that allow them to change occupations should they need to, he said in TODAY.
“Citizens need skills like problem-solving, design and critical thinking, leadership, collaboration, conflict resolution, and empathy.
“In a digital future where everyone will have access to the same data and information, these skills will be the key differentiator between being employable or not,” he added.