Covid-19: Tight border controls could lead to higher unemployment, job losses, says Lawrence Wong

• There are consequences to keeping borders tight, Education Minister Lawrence Wong said
• The number of migrant workers allowed into the country barely replace those who have left
• Manpower shortage will have a “cascading effect” on the whole economy, he added
• It could even lead to higher unemployment and job losses for Singaporeans

SINGAPORE — Closing Singapore’s borders has to be done to fight Covid-19, but the move has been tough on businesses and could even lead to higher unemployment and job losses for Singaporeans if companies continue to face difficulties or are forced to close as a result.

Speaking in Parliament on Tuesday (May 11), Education Minister Lawrence Wong, who co-chairs the Government’s Covid-19 task force, said: “I fully understand and share the desire among many to be tight on our border measures.

“We have maintained a tight posture, as I have explained, and will continue to do so. But we also need to be very clear about what this means for Singapore and Singaporeans.”

He was giving an update on the Covid-19 situation here, his fourth in Parliament since the pandemic began. 

Pointing out that contractors, who are heavily dependent on foreign manpower, will be “especially hard-hit”, Mr Wong said that Singaporeans can expect many of the new Build-To-Order (BTO) projects under the Housing and Development Board (HDB) to be delayed by one year or more. 

Private property buyers may also face delays of varying lengths.

Companies in the marine and process sectors will be badly affected as well, he added, and they will find it hard to deliver their existing projects on time. A few may even have to forgo new opportunities and projects.

“These are important sectors that we have taken decades to build — they hire thousands of Singaporean engineers and executives, and they remain crucial sources of highly skilled jobs.”

The manpower shortage will not be confined to these sectors.

Any company seeking to bring in workers from higher-risk countries will now face considerable delays since the waiting time for any entry approval could take more than six months, so “it will have a cascading effect on the whole economy,” he said.

Stresses will be felt in society, too, as Singaporeans will find it harder to reunite with their families abroad, while families applying for new foreign domestic workers to care for their children or older parents will have to wait for at least two months, he added.

MANPOWER CRUNCH HAS WORSENED

Singapore’s borders were closed temporarily last year when the Government imposed a partial lockdown from April 7 to June 1 to curb the spread of Covid-19.

After the period ended, travel restrictions were eased, such that Singapore was receiving about 820 travellers a day by November last year. This increased to about 1,200 arrivals a day between last December and March this year, Mr Wong said.

The increase in arrivals was due to an increase in migrant workers being approved to work in the construction, marine and process sectors here, and as foreign domestic workers.

However, such workers turned out to be the largest contributor to Singapore’s imported Covid-19 cases, accounting for about 40 per cent of imported cases over the past six months.

Last month, Singapore barred entry or transit for all long-term pass holders and short-term visitors with recent travel history to India. 

Soon after, visitors with recent travel history to Bangladesh, Nepal, Pakistan and Sri Lanka were also barred from entering or transiting through Singapore.

Mr Wong said that even before these travel restrictions took effect, the application backlog for foreign workers had been “building up significantly”, which means that with the current travel bans, the manpower crunch has worsened.

The inflow of construction, marine and process workers allowed into the country up to now has not been able to meet the country’s needs, because many migrant workers had left to return to their home countries.

“Whatever numbers we are bringing in barely replace those who have left,” he said.

“Our companies including many small- and medium-sized enterprises urgently need new workers to make up the shortfall and have been applying to the Ministry of Manpower for approval to enter Singapore.”

MORE HELP FOR STRUGGLING SECTORS

Mr Wong said that the Government will do more to help the construction, marine and process sectors, which are bearing the brunt of the impact of this manpower crunch, while it continues to keep a close watch over the economic situation and consider how best to support other sectors that need more help to adjust. 

For the construction, marine and process sectors, the Ministry of National Development has moved to set out a new legislation to allow existing construction contracts to be adjusted to take into account the increase in manpower costs.

This comes after the Government announced last week that firms in these sectors will receive higher foreign worker levy rebates from May to December this year. The rebate for each work permit holder will be increased from S$90 a month to S$250 a month. 

As for other businesses, Mr Wong said that they “will need to be more agile and to start factoring the need to pivot plans or operating models at short notice”.

“We will all need to learn to adapt quickly and be more nimble in this new uncertain and rapidly changing environment.”

CONTROL FOR OTHER TRAVELLERS

Ms Nadia Ahmad Samdin, Member of Parliament (MP) for Ang Mo Kio Group Representation Constituency, asked if it is possible for vaccinated citizens and permanent residents who travel abroad to serve their stay-home notices at home.

Mr Wong said that the Government prefers to take a more cautious approach for the time being and have all travellers from higher-risk countries serve the stay-home notice in dedicated facilities for now.

“We will continue to review and consider options for the future, especially as we gain a better understanding of the new variants and when more of our population is vaccinated.” 

Yio Chu Kang MP Yip Hon Weng asked about business travellers who do not need to serve stay-home notices. 

Mr Wong said it had been explained before that the Government controls the risk from this group, who are allowed to travel for essential work reasons, by keeping the numbers small and requiring them to adhere strictly to a controlled itinerary. 

They are also subject to frequent testing while they are in Singapore to ensure that they are free from the virus.

“The scope and usage of such travel passes are subject to constant review and close monitoring, to ensure they are used in a safe manner, while minimising the risks to the community,” Mr Wong added.