Points-based system may help to woo global talent to Singapore: watchers

They say awarding points to prospective work pass holders is more transparent, and system can be tweaked to align with prevailing skills shortages

Aug 26, 2021


A POINTS-BASED approach to the hiring of skilled foreign labour may be needed to keep Singapore competitive, especially as the global economy reopens, some industry watchers have suggested.

They pointed out that, with the rise of the "work-from-anywhere" trend, a switch to awarding potential S Pass and Employment Pass (EP) holders points according to set criteria could help firms here to attract skilled workers from abroad.

Christina Karl, global immigration leader at Deloitte, said: "As borders reopen, the war on talent, which started a number of years ago, will only increase." A "simplified, quick and transparent" system will thus help attract talent, given that an inflow of foreign talent may stimulate economies as they recover post-pandemic.

Points-based work-pass systems adopted in countries such as Australia use factors such as industry needs, education, experience and salary to rank prospective foreign workers.

Said Adrian Aw, director at ResourceLaw: "Such a system would, in my view, provide greater transparency and certainty to employers seeking to employ foreigners than the current system. It also enables a foreign employee to be assessed more qualitatively."

Besides the potential for enhanced transparency, watchers highlighted benefits such as the ability to easily tweak manpower schemes in line with prevailing skills shortages.

Terence Ho, associate professor in practice at the Lee Kuan Yew School of Public Policy, described the current practice of raising the EP salary threshold as "a somewhat blunt tool" to tighten the inflow of foreigners.

"A points-based system would allow for a broader set of considerations, such as employer or firm characteristics, sectoral needs, and the availability of local manpower to perform similar roles, to be taken into account," he said.

Victor Mills, chief executive of the Singapore International Chamber of Commerce, remarked that the advantage of such a scheme "is it can be regularly tweaked to facilitate" the entry of people with required skills.

"Levies are very unpopular, and if a points-based system would remove some or all of them, that would be no bad thing", he said.

Singapore is actually no stranger to the concept of assessing potential workers by awarding them points.

When the S Pass for mid-skilled staff was tweaked in 2009, the Ministry of Manpower (MOM) dubbed the changes in the assessment of applicants a "recalibration" of the points given to criteria such as job type, salary, work experience and skills.

More recently, the Singapore Democratic Party pitched a points-based system for foreign workers, in its response to the government's 2013 White Paper on population.

Adrian Sham, employer solutions partner at professional services firm Grant Thornton, noted that the MOM "already uses some iteration of a points-based system to evaluate a candidate's eligibility" based on their skills and other criteria.

"However, it is not an open points-based system that it made available to the public. It does not appear to be a fixed point system where a work pass is issued if you hit the requisite number of points," he said.

Citing Canada as a success story, Tonny Loh, partner at executive search firm Heidrick & Struggles, said other countries have successfully deployed a points-based system; Australia, for example, used a points-based foreign worker policy to plug its shortages of nurses and hairdressers.

Observers were, however, mixed on whether such a system would be necessary in Singapore. Mr Loh said that the existing work pass framework "already comprehensively addresses" issues such as how foreign talent can plug skills shortages in certain industries: "The question then becomes what a points-based system can add to the current framework and what the trade-offs will be."

Mr Aw, who works in employment law, said it is crucial that the MOM retains the flexibility to calibrate and adjust - at fairly short notice - its foreign worker policy", which he believes could be hampered by a points-based system at this stage.

For example, he said the requirement for EP applicants to have "acceptable qualifications" gives the MOM "wide discretion as to whether or not to reject an application".

"On the other hand, the transparency that comes with a points-based system would, in my view, remove the discretion and flexibility that the MOM has under the current system."

Given all this, Mr Ho, who used to be MOM director of manpower planning and policy, said: "Depending on how detailed and how transparent the points-based system is, it could increase complexity and/or uncertainty for businesses in terms of planning for their manpower needs.

"The points-based system would also have to be continually adjusted in line with labour market conditions, both at the national and sectoral level."

Mr Chia also warned that the system could have teething issues, such as "some short-term impact on the availability of skilled foreign talent and companies' hiring practices", as companies put ongoing relocation on hold until the implications of a new policy on these hires is clearer.

Whichever way policy goes, adopting a points-based system will need firms' input, watchers stressed.

Mr Mills says he believes there would be "careful and broad consultation with industries and businesses for them to understand what is envisaged by such a scheme, how it would work, what they think and what the trade-offs might be" if such a system were on the table.

Mr Chia also said: "The more transparent the policy, the better people and companies can adapt and plan ahead - especially amid important given pandemic-related uncertainties."

Mr Ho called the potential introduction of such a system "a major change for Singapore's EP regime, and certainly much consultation with the business community would have to precede such a move".

The system would also have to be consistent with Singapore's obligations in the international trade agreements that contain manpower-related provisions, he added.

Ms Karl said: "The timeframe would be dependent on how quickly the government can set up the industry sector approvals ... Industry must be heavily invested in working with the MOM to provide feedback to the needs and challenges of each specific industry."

Still, "the key consideration for policymakers to bear in mind is that the decision of who to employ is a matter for each company", Mr Mills said.