SINGAPORE: Jamus Lim, the Workers’ Party Member of Parliament for Sengkang GRC, has reiterated the need for Singapore to enhance its unemployment safety net.

He underscored the crucial importance of ensuring that retraining programs for retrenched workers align with market demands, ultimately leading to meaningful job placements.

In a recent Facebook post on Monday (13 Nov), Jamus Lim shared insights from a conversation with a constituent who lost his job due to corporate downsizing.

The resident, a PMET (Professional, Managerial, Executive, and Technical), detailed the challenges he faced in securing another job following the closure of his office.

Assoc Prof Lim, echoing sentiments shared in Parliament, believed that Singapore can take proactive steps to establish a seamless pathway from redundancy-unemployment support-retraining-reemployment.

The Workers’ Party has consistently advocated for redundancy insurance, and Jamus Lim acknowledged the government’s indication that such a scheme may soon be rolled out.

Bridging the gap between training and employment, advocating for job assurance

Furthermore, he proposed refining the SkillsFuture program to better align with industry needs, ensuring that workers gain practical and experiential skills sought by employers.

A critical point raised by Assoc Prof Lim is the necessity for assurance that retraining efforts directly lead to viable job opportunities.

“This has to come from not only making sure that the SkillsFuture courses and retraining programs pursued closely align with actual business needs; it can go further to provide a soft guarantee of a job.”

To achieve this, he suggested the government establish a database of required skills, matching trainees to courses with a commitment to job placement for at least six months post-reskilling.

“To sweeten the deal on the employer side, the government can cover part of the retrained worker’s wages during this period. ”

Jamus Lim pointed out that such an approach is already in practice in several Scandinavian countries for managing unemployment.

As a nation emphasizing the importance of human capital development, he expressed hope that Singapore will progressively enhance its unemployment safety net to suit the demands of a 21st-century economy and society.

The Workers’ Party’s ongoing advocacy for enhanced safety nets via redundancy insurance

The Workers’ Party has been calling for a redundancy insurance scheme, most recently at the Budget 2023 debate. The Workers’ Party published a policy paper on Redundancy Insurance in 2016.

Revisiting Assoc Prof Lim’s address in Parliament during the Budget 2023 debate in February, he once again emphasized the Workers’ Party’s persistent proposal: the expansion of workers’ safety nets through redundancy insurance.

He underscored the importance of establishing a backup support system for workers facing redundancy, enabling them to access their primary welfare system—the availability of employment opportunities.

“In the spirit of encouraging risk-taking and entrepreneurship, we can also consider including the self-employed into the scheme—perhaps with different contribution shares—as we did during COVID-19,” he said.

He addressed concerns about the potential negative effects of redundancy insurance on workers’ incentives to search for a job, but noted that studies of advanced economies that have rolled out such insurance schemes tend to find little adverse consequences for employment outcomes.

The cost of the redundancy insurance scheme proposed by the WP is much lower than in other jurisdictions, as it only covers redundancy and unemployment rates in Singapore tend to be much lower.

At the time, Assoc Prof Lim suggested that contributions toward redundancy insurance should be passed on to workers, but the government should also contribute regularly to the pool in the form of a special-purpose development fund.

In this year’s WP May Day Message, Mr Pritam Singh, Leader of the Opposition and WP Chief, also emphasized the party’s conviction that a redundancy insurance scheme can alleviate immediate financial strain for retrenched workers and act as an automatic stabilizer for the economy. This includes sustaining consumer spending and mortgage payments until individuals secure new employment.

PAP government finally unveiled its “temporary safety net” scheme, despite reluctance to label it as “unemployment insurance”

Interestingly, after prolonged advocacy by the Workers’ Party for redundancy insurance for retrenched workers, Singapore’s Prime Minister Lee Hsien Loong finally addressed the issue during the National Day Rally in August.

He announced a government initiative to provide interim financial support to individuals facing retrenchment, emphasizing the aim to allow them to concentrate on skill enhancement for more promising long-term employment opportunities.

The new scheme, deemed as a “temporary safety net” by PM Lee, seeks to empower those laid off to participate in skills courses, steering away from hastily accepting any available job in times of desperation.

On 24 August, the Manpower Minister Dr Tan See Leng further revealed that much of the upcoming temporary financial support for retrenched workers will be tied to training and career counselling and guidance.

However, he noted that targeted support for retrenched workers should not be seen as “unemployment insurance”.

Instead, it aims to empower displaced workers with the time and resources needed to identify industry trends and select a new job that aligns with their skills and interests.

Dr Tan added that workers will also get help maintaining their “career health”, for instance through personalised jobs and skills recommendations on the national jobs portal MyCareersFuture.

An extensive Forward Singapore report announced two weeks ago, also outlined various policy adjustments and recommendations, this also including addressing wage disparities, extending financial aid to those involuntarily unemployed, and ensuring a financially stable retirement for Singaporeans.

During a press conference discussing the report, Dr Tan emphasized the pivotal role of tripartism in achieving a substantial transformation toward more equitable, inclusive, and collaborative workplaces.

Tripartism involves a collaborative approach that includes the government, employers, and the labour movement.

Minister Tan acknowledged concerns about job security and retirement adequacy, particularly for those caught between caring for elderly parents and supporting their children. In response, the government is dedicated to supporting Singaporeans in several ways.

This includes empowering individuals to manage their career health through access to better data and information, investing in their development, facilitating exposure to global opportunities, reducing wage gaps, and providing support schemes for those facing setbacks and involuntary unemployment.