Singapore Tightens Employment Pass Requirements for Professionals

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The new Employment Visa framework will make it more difficult for foreigners to obtain junior to mid-level professional positions in Singapore. The short to medium term impact of this change on Singapore’s economy is difficult to predict, reports

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Singaporeans will benefit from this framework. However, foreign companies planning to establish an operational base here could start re-thinking their decision. It is unclear whether the new framework will boost or hinder Singapore’s economy.

In a bid to achieve higher economic growth through a more productive labour force and to limit its reliance on foreign talent, the Ministry of Manpower (MOM) has recently announced stricter qualifying criteria for the Singapore employment pass. The new framework, which mandates higher educational qualifications and higher salary thresholds, will primarily affect junior to mid-level professionals i.e. potential applicants and current holders of the Q1 and P2 Pass., a leading Singapore-focused business information portal, reports that it is unclear whether more good or harm will result from this change.

The latest change follows earlier enhancements to the Singapore employment pass framework that came into effect on July 1 this year. As of that date, the minimum qualifying salaries for the P1, P2, Q1 and S Passes have been raised to S$8,000, S$4,000, S$2,800 and S$2,000 respectively. The new framework, which will be implemented on January 1, 2012 will require every new applicant to meet a minimum monthly salary of S$3,000, as well as possess a degree from a bona-fide educational institution to be eligible for the Q1 Employment Pass. This means that graduates from good universities can qualify for the Q1 Pass if they earn at least S$3,000 a month. Additionally, new applicants of the P2 Pass will have to meet a higher minimum monthly salary of S$4,500. No further changes were made to the P1 Pass. Nevertheless, MOM will still carefully consider each application and may make exceptions on a case by case basis as some applicants may not have the required qualifications but possess good track records and skills that are in demand.

Commenting on the move, Ms. Jacqueline Low, the Director of Janus Corporate Solutions - the parent firm of the site - said, “The Employment Pass framework hopes to see the rapid growth of foreign labour in recent years slowing down. This will help meet the policy goal of keeping foreign labour below a third of Singapore’s workforce in the long term. This will also ensure that Singaporeans remain as the foundation of the workforce and do not face unfair competition from equally qualified but lower-waged foreign applicants. Hence, Singaporeans will benefit from this new framework. Additionally, the higher educational requirements will improve the quality of professionals in Singapore, thereby, helping meet the country’s higher productivity goals.”

However, further analysis by shows that the framework could unwittingly make it harder for multinational companies and SMEs to find and employ appropriate talent. “Foreign companies and business owners planning to register a Singapore company and establish an operational base here could start re-thinking their decision. This is because they understand that they may face difficulties bringing in employees from their overseas offices to Singapore with the stricter educational requirements in place. On a macroscopic level, fewer business relocating to Singapore means slower economic growth for Singapore. Furthermore, the July 1 framework has not been popular with members of Singapore’s SME community. Many have raised their concerns about the framework as they have found it more difficult to run operations with higher hiring costs. Therefore, we can anticipate that the January 2012 framework would deepen the strain for SMEs which rely on foreign talent to fill in positions that are not favored by Singaporeans. In summary, it is unclear whether the new framework will boost or hinder Singapore’s economy,” added Ms. Low.

About is a unit of Janus Corporate Solutions Pte Ltd - a leading Singapore-based firm that provides prompt and cost-effective services to local and foreign entities for Singapore company registration, branch office setup, owner/staff relocation, taxation and ongoing statutory compliance needs.


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