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Launch of the Skills Redevelopment Programme for Infocomm

Lim Swee Say, Minister of State for Communications & IT and Trade & Industry - Speech Skills Redevelopment Programme for Infocomm Launch

Lim Swee Say, Minister of State for Communications & IT and Trade & Industry - Speech
Skills Redevelopment Programme for Infocomm Launch
Singapore, 3 August 2000

1. In 1998, 29,100 workers were retrenched and 23,400 jobs were lost in the economy. Last year, retrenchment went down to 14,600 while job creation turned positive to 39,900. This downward trend in retrenchment and upward trend in job creation continued into the first six months of this year. Yet, unemployment dropped from 4.3% in end-'98 to 2.9% by end-'99, but went up again to 3.4% in 1Q '00.

2. One may wonder, why didn't the unemployment rate continue to decline? Why are we not back to full employment yet after 6 quarters of positive growth?

3. During the economic slowdown, we had unemployment because there was a shortage of jobs. Now that the economy is growing again, the cause of unemployment is not so much the shortage of jobs, but the mismatch between job seekers and job supply. As a result, the threat we face is not simply the potential rise in unemployment, but structural unemployment.

4. Singapore is not the first country to encounter structural unemployment, nor will we be the last, because it is an outcome of economic progress. Three years ago when I was with the labour movement, I visited Europe together with union leaders Mr John De Payva and Mr Cyrille Tan. Europe was suffering from serious structural unemployment. We asked a European union leader what actions were taken by European nations to address the problem. His reply was that nothing much was being done and that he was resigned to the fact that only time would solve the problem. When I asked him to elaborate, he explained that in 20 years' time, many of the workers who were structurally unemployable would reach the retirement age. When that happened, the problem of structural unemployment would resolve by itself! I was not sure if he was serious, but I could tell that he felt helpless as a union leader. He was not able to do much to help the many workers who were structurally unemployable, except to see them surviving on unemployment benefits and wait for them to retire from the workforce over the next 20 years.

5. We see structural unemployment happening in Europe. We also see it happening in USA, though to a much lesser extent. It is difficult to avoid structural unemployment completely, especially so in a fast pace economy like what we have here in Singapore. As we move up the economic ladder, there will be greater demand for higher-skilled people. It is unavoidable. What we need to do is to recognise the growing mismatch in the employment market, and do our best to minimise it.

6. I wish to emphasise that we should never take structural unemployment lightly because it has major social and economic implications should we end up having serious structural unemployment in Singapore. Our people sector will suffer because we will have a growing number of frustrated Singaporeans who are out of jobs even though there are many job openings in Singapore. Our private sector will suffer too, because businesses, big and small, will face a shortage of workers even though there are many jobless Singaporeans looking for jobs. Our public sector will be in a dilemma too. How are we going to support the requests of the private sector for more foreign workers and talents when there is growing unemployment among the people.

7. In short, structural unemployment will not only slow down economic growth, but also heighten social tension and weaken cohesion in the community. It is a "no-win" outcome for our three "P" sectors - People, Private and Public sectors.

8. A number of factors contribute to the rise of structural unemployment. In the Singapore context, the main reasons are: lack of relevant skills, long travelling time to workplace, unwillingness to work on rotating shifts, and inability to adapt to new working environment such as clean room operations.

9. These are multi-faceted issues. There is no way we can resolve them unless the three "P" sectors work together closely, each playing its part.

10. Employers and government agencies need to appreciate the constraints faced by the workers. We need to recognise that it is quite painful for workers to have to spend 3 to 4 hours each day on the road to take up jobs that pay them only a few hundred dollars a month. We need to train them and help them to upgrade so that they can take on better paying jobs. We should also redesign jobs to make them more flexible and attractive to the workers, and continue to upgrade our public transport system to cut down their travelling time.

11. Likewise, workers need to help themselves so that the government, employers and labour movement can help them. Our workers must be prepared to learn new skills, and adapt to new working hours and environment. There is no way we can slow down the pace of change to suit our workers, because the pace of change in our economy is not determined by our willingness to run fast, but by the regional and global competition. If we slow down to avoid structural unemployment, we will become uncompetitive and still end up with unemployment any way. There is no easy way out of unemployment or structural unemployment. Learning new skills and adapting to new working hours and environment is the only way for us to regain and sustain full employment in the New Economy.

12. The launching of SRP for Info-communications today is inline with our national efforts to minimise the threat of structural unemployment. We are fortunate that here in Singapore, workers do not have to remain unemployable and wait to retire from the job market. The tripartite partners are working hand-in-hand to help our rank and file workers upgrade their skills to remain employable. Under the SRP spearheaded by the NTUC and supported by the government and business community, we have committed ourselves to help 100,000 workers to upgrade and acquire certifiable skills over a period of five years. I am glad to hear from Mr Heng Chee How this morning that 30,000 workers have come forward to participate in the SRP. I hope more workers and employers will come forward to take part in this programme. Working together, I am hopeful that we can turn the no-win situation of structural unemployment into an all-win situation of full, or near to full employment in the near future.

13. I would like to end by thanking the NTUC, the unions, companies, MOM, IDA and all parties involved for your contribution and participation in the SRP for Info-communications. Thank you.