Why do we need foreign talent? Simply put, there are not enough Singaporeans. This causes a lack of available manpower, but also a shortfall of Singaporeans with the right skills to meet the growing and widening demand of businesses. To support Singapore’s continued growth and competition at a global level, foreign talent is needed to complement the local workforce. Without this, businesses will be unable to compete or must move their businesses overseas which could reduce the number of jobs available in Singapore for Singaporeans.
The introduction of a new Tech Pass to attract founders, leaders, and technical experts with experience in established or fast-growing tech companies is highly welcomed and shows the government agrees with our analysis. However, this only targets a specific sector and more should be done to help businesses attract foreign talent to Singapore. It is hard to understand why the Not Ordinarily Resident Scheme (NOR) was withdrawn.
Alternatives to a new and improved version of the NOR scheme could include a lower flat rate tax, improved pension provisions for expats, and tax incentives on long-term incentive plans (equity or otherwise) which are based on building up economic value in Singapore.
Globalisation of the talent pool
The COVID-19 pandemic has had a huge impact on the global workforce. It has led to companies scrambling to dust off their business continuity plans and find, or create, their work-from-home (WFH) policies. This ability to WFH poses Singapore another challenge: If everyone can work from home, why do businesses need to set up in Singapore or why do businesses need to hire people in the same country as themselves?
We have steadily seen a growing number of employers employ people outside of their country, including many digital nomads. Will their laptop, rather than a physical workplace, be their office going forward? A challenge for companies wanting to hire people who work from a foreign location is the issue of permanent establishments and employer reporting obligations. In many foreign locations, it is not as easy as issuing an employment contract and sending a salary each month. It could lead to a taxable presence for the company. This has historically discouraged employers from hiring employees who continue to live overseas.
This, combined with the fact that Singapore still has so much to offer businesses from transport links, a highly educated workforce, stable political and business environment to name but a few, means that Singapore will continue to attract both businesses looking to set up to attract talent and for foreign talent to relocate to.
Making Singaporeans the foreign talent
Many countries have incentives to attract expatriates to work in their countries and they would jump at the opportunity to bring in highly educated Singaporeans. We should also encourage Singaporeans to take these opportunities up, for example:
The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by Singapore Business Review. The author was not remunerated for this article.
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