Doubling down on workforce transformation

SINGAPORE’S journey to transform its workforce started in 2015, with the introduction of the nationwide SkillsFuture initiative. A decade on, upskilling remains a national priority. Budget 2025 announced several workforce transformation measures, in a bid to sharpen the workforce’s competitiveness in an evolving geopolitical and technological landscape, and enable individuals to forge meaningful career pathways.

While the policy aims are clear, successful implementation and adoption is crucial. With the Committee of Supply debates coming up, we look forward to the details on operationalising the proposed Budget measures, in the hope that existing concerns can be adequately addressed.

Combine “what to” with “how to”

Job redesign remains a key tenant of industry and workforce transformation.

Companies are best-placed to continuously define – and redefine – how jobs should devolve as they press on with business transformation. The introduction of the SkillsFuture Workforce Development Grant and redesigned SkillsFuture Enterprise Credit scheme, coupled with the expansion of NTUC’s Company Training Committee (CTC) Grant, will provide companies with added support for their workforce transformation efforts.

To meaningfully tap these measures, small and medium-size enterprises (SMEs) often require guidance on determining the jobs that will need to be created and redesigned, and how to do so.

One way to address this is to expand the Job Transformation Maps (JTMs) that have been rolled out for various key industries. Currently, the JTMs detail how jobs and skills are expected to evolve in the specified industries. Potentially, the JTMs can be expanded to cover a broader set of industries such as manufacturing, maritime and aerospace. Also, the JTMs can delve into the impact of technology, artificial intelligence and sustainability on future jobs and skills.

Involving the wider ecosystem can help drive a more robust approach to supporting job redesign and upskilling. To this end, institutes of higher learning can partner SMEs more closely to develop learning programmes that help individuals acquire fit-for-purpose industry skills, while trade associations and chambers can play a crucial intermediary role to aggregate upskilling demands and bridge the knowledge gaps of SMEs.

It is also worthwhile to consider introducing a Chief Human Resource Office-as-a-Service (CHRO-as-a-Service) scheme – similar to the Infocomm Media Development Authority’s Chief Technology Officer-as-a-Service scheme. Just as how the latter helps SMEs identify and utilise digitalisation resources based on their business needs, the CHRO-as-a-Service can facilitate access to industry HR expertise, and leverage best practices to jump-start or accelerate their workforce transformation.

Streamline and simplify for speed

A common concern of SMEs when leveraging grants and schemes is the need to pay for the costs upfront and seek reimbursement from the government subsequently. Despite recent streamlining efforts, SMEs may still have to wait for up to two months for reimbursement, which can be a significant financial burden for cash flow-constrained companies.

It is timely that the SkillsFuture Enterprise Credit will be redesigned to operate like an online wallet, allowing companies to use the credits to immediately offset out-of-pocket costs for eligible workforce transformation initiatives. Adopting a similar approach for all workforce transformation grants and schemes, including the CTC Grant, career conversion programmes and the newly announced SkillsFuture Workforce Development Grant, would be hugely beneficial in easing cash flow concerns.

As well, companies will need to review their technology and business processes in tandem with workforce initiatives. This means having to apply for separate grants, which adds to the labyrinth of administrative processes. By bundling the application for grants and schemes for workforce transformation with those for related technology and business process transformation in one single platform, this can improve the efficiency for both SMEs and the approving agencies – and help with the speed of implementation.

Improve career health and longevity

According to the Labour Force in Singapore 2024 report, the median age of Singapore’s workforce in 2024 was 45 years, with 62 per cent of workers above 40 years old. The career health for these mature (aged 40 to 49) and senior (aged 50 and above) workers is hence important to the longevity of the workforce and continued viability of Singapore’s economy.

Unsurprisingly, improving the employability of mature and senior workers was a focus of Budget 2025. Initiatives such as the SkillsFuture Jobseeker Support scheme, localised Jobs Placement Centres in all community development centres nationwide, extension and expansion of the Senior Employment Credit, and increase in Central Provident Fund contribution rates for those in the 55-to-65 age range all point to the aim of enhancing the career health of this segment of workers.

These announcements also complement measures announced in previous Budgets, that provide for additional funding for upskilling and wage support for locals aged 40 and above, such as the SkillsFuture Level-Up Programme and the SkillsFuture Mid-Career Training Allowance.

To give these measures a boost, it will be helpful to increase the amount of SkillsFuture Mid-Career Training Allowance that learners can receive when they are on full-time or part-time training. These allowances, currently set at S$3,000 and S$300 a month for those on full-time or part-time training, respectively, may be considered low for experienced workers. It may not be enough of a nudge in motivating them to embark on a true reboot of their skills to remain relevant in the future.

Further, increasing the dependency ratio ceiling for companies that demonstrate a strong appetite to hire and upskill local mature and senior workers will encourage more organisations to adopt more age-friendly workplace practices, and uplift the employability and livelihoods of mature and senior workers.

Reskilling and upskilling are vital for SMEs and workers to develop future-ready capabilities that will allow them to thrive in today’s ever-evolving business environment. As the saying goes, “The devil is in the details.” It is with much excitement that we anticipate the details of the Budget 2025 proposals in the weeks to come – and see the wheels of active adoption in motion.

Samir Bedi is EY Asean people consulting leader and Goh Jia Yong is partner, people consulting, at EY Advisory.

The views here are the writers’ and do not necessarily reflect the views of the global EY organisation or its member firms.