Education and labour market flexibility have gone some way to balance the labour market but the impact of skills shortages remains acute, according to the Hays Global Skills Index. Can Singapore deliver the high-skills needed?
The Index assesses the efficiency of the skilled labour market in 30 countries, or its ability to supply skilled labour. The Index scale ranges between 0 and 10, with the higher the Index score the greater the difficulty for employers in findings skills. A score greater than 5 indicates skill shortages; 5 or less indicates few signs of skills shortages.
Yet the score of 4.6 for Singapore is indicative of a mixed labour market, where Singapore’s low scores for education and labour market flexibility pushed down the overall score despite the country’s ongoing and acute shortage of high-skills.
“The current economic landscape is looking a lot more positive,” says Chris Mead, Regional Director of Hays in Singapore & Malaysia. “The global growth outlook is looking firmer, with Singapore more upbeat.
“Yet unemployment is very low and employers continue to struggle to attract highly skilled and experienced professionals.
“It is a bitter paradox caused by employers being unable to find the skilled workers they need, particularly in more technical areas such as IT, construction and engineering,” he said.
The overall Index score is the average of seven indicator scores. Three indicators explore the supply of talent, namely education flexibility, labour market participation and labour market flexibility. One looks at talent mismatch.
The final three are wage pressure indicators, looking at overall wage pressure, wage pressure in high-skill industries and wage pressure in high-skill occupations.
“Skills gaps can manifest themselves through wage pressures, a talent mismatch and/or supply,” says Mead. “Our Index looks at all three areas and shows that in the wage pressure category Singapore is certainly seeing widening pay differential pressure between high-skill and low-skill industries and occupations that is up near the top of the 30 countries included in the Index.
“The score of 8.5 for ‘wage pressure in high-skill industries’ in Singapore shows there is a widening pay differentials between high and low-skill industries.
“Much like developments in industry pay, Singapore is also seeing a widening gap in pay differences between high-skill and low-skill occupations, as indicated by the score of 8.5 for ‘wage pressure in high-skill occupations’.
“These movements in pay are a local reaction to the skills shortage as employers struggle to recruit staff for roles in high-skill industries and high-skill occupations.
“Meanwhile, Singapore’s score of 5.9 for ‘talent mismatch’ suggests the labour that is available lacks the skills employers want. This mismatch between the demand and supply for skills means employers’ expectations for skills and experience are not always being met by the available candidates,” said Chris.
According to Hays, in Singapore the top seven skills in most demand are:
- Internal Auditors
- Senior Project Managers
- Qualified Accountants
- Business Development Managers
- Cloud Architects/Engineers
- Experienced salespeople
- Banking professionals