Singapore employment pass requirements tighten as unemployment soars and the country responds to the economic damage brought by the pandemic.
Singapore employment pass requirements now include higher minimum salaries for two categories of passes.
Employment pass holders in executive, managerial or specialized roles must have a minimum monthly salary of S$4,500 ($3,295), versus a previous threshold of S$3,900, based on a Ministry of Manpower release.
Meanwhile, employees with an “S pass,” or mid-level technical staff should bring home at least S$2,500 per month, an increase from S$2,400.
The minimum qualifying salary for an employment pass in the financial services industry will be S$5,000 due to higher pay in the field. The ministry stressed that this is the first time salary requirements have increased for a particular sector.
The Singapore government wants to empower the local workforce at a time when retrenchments are rampant and the city-state is grappling with its worst recession on record. Due to its small and aging population, the city-state is seeking a balance that will allow it to hire enough foreign talent, particularly in cybersecurity and financial technology.
As they evaluate passes, the ministry will determine whether the employer also prioritizes recruiting local professionals and supporting government efforts to hire and train them, as well as not committing discrimination against Singaporeans.
“We are giving these considerations additional emphasis now, given the uncertain economic times, to remind all employers to play their part in building up their Singaporean workforce, and help sustain public support for a business-friendly work pass policy,” according to the statement.
Changes on work passes
The changes on Singapore employment pass will take effect for new applicants from September 1 for employment passes and October 1 for S passes. The changes will apply for renewal applicants from May 1, 2021.
Meanwhile, the higher minimum qualifying salary for the financial services industry will be effective starting December 1.
Workers who are 40 years and older are required to earn “around double” the minimum qualifying salary for the youngest workers. This applies for employment pass holders in all sectors.
The previous change on the minimum salary requirements was released in May. It goes through periodic reviews of the thresholds as a response to wage growth and bigger inflation measures.
In a separate statement, the Monetary Authority of Singapore said that it supports the changes for work passes in the financial sector. The adjustments will “continue to allow financial institutions to complement their local workforce by tapping on a global talent pool for the specialized skill sets that the financial sector needs,” it said.
In July, the Monetary Authority of Singapore said that the economy still in a “dire” situation due to the coronavirus pandemic.
The Singapore economy is facing high unemployment rate and corporate bankruptcies that are expected to rise in the coming months.
Advance estimates issued by the Ministry of Trade and Industry affirmed that the Southeast Asian economy entered a technical recession after falling by 41.2% in the second quarter compared with the previous quarter.
“We are not at the beginning of the end, but rather the end of the beginning,” said Ravi Menon, managing director of the Monetary Authority of Singapore, which is the country’s financial regulator and central bank.
“The recovery is likely to be slow and uneven, weighed down by renewed outbreaks of infection here or abroad,” he added. “We will enter 2021 with higher levels of debt, in both the corporate and household sectors, which will act as a further drag on growth and could become a source of vulnerability.”