Regionalization, economic restructuring and labour migration in Singapore

This paper documents the impact of economic development on changes in employment and labour migration in Singapore. High export-led growth and the relaxation of immigration policies in the late 1960s enabled employment of substantial numbers of unskilled foreign labour in manufacturing, construction and domestic service sectors. The influx of foreigners has been cited as one possible cause of low productivity growth in the 1970s. Economic development in the 1990s has led to increased retrenchments and a moderation of demand for foreign workers. The upgrading of remaining production operations in Singapore is expected to increase demand for workers with higher skill levels. Emigration of highly educated and skilled professionals from Singapore became a national concern in the late 1980s. With regionalization, the new challenge in the 1990s has become one of encouraging Singaporeans to temporarily take up overseas positions. The future foreign labour pool in Singapore is expected to comprise a growing proportion of skilled workers to sustain the 7-8% economic growth rate in the medium term. Slower economic growth in the developed economies and the internationally competitive salaries paid to professionals in Singapore are expected to continue to reduce the outflow of permanent emigrants from Singapore.