As this shift was made there was a significant shortage of skilled workers and professionals. Since this was during times of low-unemployment, to address this worker shortage the government took a tow-pronged approach. The first short-term solution was to attract skilled foreign workers and Multinational Corporations and the second longer-term solution, Singapore lacked the necessary existing workforce with the higher level skills to promote science and technology based sectors. The government addressed this by re-designing the education system to directly support the building up of the skills to feed in to the growth technology sectors.
To satisfy the demands from higher technology and manufacturing intensive employers the government needed to ensure the skills in demand, would be supplied by the education and training system. This was addressed by trengthening, broadening and centralizing the education system, and by introducing targeted training to upgrade the skills of those already in the workforce. In the 1990s Singapore again revamped their industrial strategy. Singapore would continue to focus on attacting Multinational Corporations, but would target those growth sectors for the future that focused on higher level skills, especially in the technology sectors. At the same time the education system was also adjusted to focus on students abilities especially in innovation, creativity and entrepreneurship while previously the education system had been focused on standardization.
Currently there are several organizations involved in supporting skills development in Singapore including: the Ministry of Trade and Industry, the Ministry of Manpower, the Ministry of Education, the Economic Development Boad and various ministerial divisions. The Ministtry of Trade and Industry and its operational unit, the Economic Development Board (EDB), have a strong influence on the activities of the others. In Singapore, the priorrity for economic development determines the process of skills formation, and the mandate of the EDB in to create a sustainable GDB growth for Singapore with good iobs and business opportunities for its people. The Asian financial crisis in the late 1990s and the recent knowledge revolution promted the Singapore government to change policy into what it is today. The Economic Development Board identified new key sectors and industries to help Singapore become a global leader in the nkowledge and technology economy. For each of the sectors, the EDB developed a strategic plan, containing objectives and targets.
Skills that are required for supporting sector development are identified through a multi-faceted approach. The Manpower Research and Statistics Division undertakes econometric forecasting in ooder to identify the countru’s skill needs for the medium, 3 to 5 years, and the long, 5 to 10 years, terms. Decisions about which sectors to investigate are guided by the EDB and these forecasts are suuported by inputs from the different sector committees. This approach enanles the Ministry of Manpower (MoM) to produce a skills map delineating which skills are in demand and the degree to which Singapore is producing the appropriate supply of skills.
The importance Singapore attaches to matching skill supply and demand is seen in the fact that every six months a cross-Ministerial committee meets to identify the degree to which the country’s skill needs are being met. Representation on this committee includes the Ministries of Manpower and Education. Skill needs are converted into the supply of skills throung the work of the EDB and the WDA. They do so through the use of the following strategies: an expansion of pre-employment training, upgrading the skills of the existing workforce, and attracting foreign manpower from overseas.
Singapore has introduced a number of incentives to encourage workers to upgrade their skill, including encouraging further learning for those already in the workforce. A series of grants are offered to people who have completed their post-secondary level education, including a payment of $800 to enable graduates to study for a qualification that has a market demand. A similar grant in provided for polytechnic students to enable them to study for a graduate level qualification. The MoM will also provide 80% of the funds if an education programme leads to a qualification that is in high denmand.
The Workforce Development Agency (WDA) plays an equally important role in upgrading the skill levels of the workforce through the following three progammes: skills conversion, skill upgrading, and enhanced employability of lower skilled workers. The skill conversion programme is primarily targeted at workers who have been laid-off due to economic restructuring. The programme provides a worker with basic skills training in an area that has a high market demand. The skill upgrading programme is targeted at workers who have been laid-off due to economic restructuring. The programme provides a worker with basic skills training in an area that has a high market demand. The skill upgrading programme is targeted at older people who already have jobs. The purpose of this programme is to help improve productivity within seclected growth sectors. The third strategy is targeted at enhancing the competencies of the lower skilled worker through a programme called Work Redesign. Under this program the WDA attempts to redesign jobs in targeted sectors so that the person becomes more productive. If the MoM or the WDA is unable to develop the skills of local people in response to identified needs then the final option is to search for skiiled foreign workers.
The Skills Development Fund (SDF) provides financial incentives for training those people already in the workforce, those preparing to join the workforce, and thosere-entering the workforce. The funds are collected from the Skills Development Levy imposed on employers of foreign workers and on employers with workers earning less than $1,500 a month at a current levy rate of 1% of monthly remuneration. All companies registered in Singapore are eligible for support from the SDF.
We have seen that Singapore was faced with a tough challenge, how to catch-up to more developed economies when they had no natural resource base and a small low-skilled population. They responded by initiating a decades long plan of state managed interventions in industrial development, education and training. Singapore used industrial policies to manage growth systematically up the value chain by targeting sectors they determined would be vital for future growth. They tied-in their education and training polucies to overall economic development to ensure that all three aspects workers together to ensure close to full employment and that employers had the necessary skilled workers avaiable.
This development process was very rapid and Singapore succeeded in catching up to developed economies in just one generation. One of the reasons this was possible was because they had the lessons other countries learned during their development process to learn from. Singapore worked hard to target growth towards technology intensive sectors, and once they did so, they could look at skill and education development strategies already tested in other countries and pick those that best suited their objectives. Very little experimentation was necessary. During this progression Singapore focused on centralized, systemized processes to deliver skilled workers in to the market. Singapore has since taken a further step, moving on from srandardized education and training towards more ability based education that focuses on innovation, creativity and entrepreneurship to attract high technology industries.
Though Singapore ia a very unique country, other nations can use Singapore as example to assist them in designing their skill development and catching up strategies, because that is exactly what Singapore did. Singapore looked very closely at where they wanted to go, which sectors they wanted to focus on and what assets they had as a nation. They then used off-the-shelf education, skill development and industrial promotion policies, which they adapted to their national context, to very rapidly develop and catch-up-to more developed countries. The key was that Singapore was very motivated, highly focused, able avoid political battles and very strict about not protecting sectors that were not deemed necessary for their goal to move up the value chain.
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