Will Singapore Still Be An Attractive Working Destination if Minimum Wage Comes to Force?

For those who have been following the news and development in Singapore, it is known that the Singapore government has introduced a PWM (Progressive Wage Model) to cover lower-wage workers in cleaning, security, landscaping and lift . It is line with their effort to raise the standard of living and job progression for the workers.

It is also a deliberate act to give the recognition and respect to these essential workers whose work were often overlooked and unappreciated. “This is a timely and necessary review to recognise the importance and higher value of work shouldered by our cleaners, particularly during the COVID-19 pandemic,” TCC (Tripartite Cluster for Cleaners)  and the National Trades Union Congress (NTUC) of Singapore quoted as saying in a joint media release last year. Since 2014, it has been a licensing condition for cleaning companies for upgrading their labour skillset. The progressive wage model is designed to raise the salaries of lower-wage workers by upgrading their skills and increasing their productivity.

With the opening of land borders between Singapore and Malaysia, what would the job market look like in these two economically intertwined nations? Will the minimum wage make the Malaysian workers stay put to where they are right now?

Currently there are 400,000 were said to work and live across the Causeway. Before the closing of borders, some 350,000 Malaysians commuted daily from Johor to Singapore for work.

With the borders now open, it is widely and reasonably expected that more Malaysian jobseekers are expected to seek employment in Singapore. 

It is a known fact the city state needs foreign workers for its dangerous, difficult and dirty jobs, the blue-collar workers enjoy three times the salary that of Malaysian. The rationalisation behind every blue-collar work is, why reject a salary that is almost three times more than what is offering in Malaysia, when the nature of job is almost the same. The calling for giving better standards of living is hard to resist!

At the time of writing, it has been widely reported that the F&B and manufacuring industries are apparently facing a shortage of labour in Johor and Singapore.

Also worth mentioning is, experienced and professional workers are in demand in the city-state that offer better career opportunities and better perks (some even say, better exposure). Not only that, fresh university graduates are actively seeking job opportunities according to job agencies in Johor.

As a result of this trend of Malaysians traveling across the border to take up jobs in Singapore, the job market in Malaysia is facing a shortage of manpower supply, as new job positions in Singapore open up with the reopening of borders with Malaysia, more in Malaysia are coming to Singapore to work.

This goes without saying that the financial gain is the main attraction with the Singapore Dollar commands higher value. “Earn In Sing Dollar, Spend in Ringgit – you will see your purchasing power surged!” This is how a lot of Malaysians think when choosing for a career path or a job in Malaysia, moreover its proximity to homeland also makes it a very attractive destination to work, with many cultural similarities between the two nations. In addition, the rise of living costs and inflation has contributed to the push for working professionals to work in Singapore instead.

Since January this year, job agencies in Johor have received an average of 30 applications a month from Singapore companies which were looking to advertise open positions on their platform. Singapore is currently facing a dearth of workers. Besides calling for former employees who’ve returned to Malaysia to come back, companies are also continuously seeking fresh talent.

How to keep the local talents here? Malaysian employers need to offer more upskilling and reskilling opportunities to existing employees, especially on new technologies, digitalisation and 5G. According to a report recently, “Malaysian employers are the most stingy in this region”. That is something worth pondering on, for sure!

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