Out-Law / Your Daily Need-To-Know

Singapore’s job support scheme has supported 270,000 jobs

Out-Law News | 23 Jul 2021 | 1:14 am | 1 min. read

Singapore’s Jobs Growth Incentive (JGI) scheme supported 270,000 jobs between its launch in August and February, according to the government.

42,000 businesses companies participated in the scheme, 99% of which were small and medium-sized enterprises (SMEs).

According to manpower minister Tan See Leng, half of the 270,000 JGI-supported hires were not unemployed when they were hired, with about a third out of work for more than six months.

The JGI was introduced in August 2020 to support employers to expand local hiring. To qualify for JGI, there must be an increase in the employer’s overall local workforce size and an increase in that part of the local workforce earning S$1,400 ($1,000) or more, compared to the period before the scheme, or ‘qualifying window’. The qualifying window for phase two of the JGI is March to September 2021.

Under the scheme the Singapore government pays 25% of the first S$5,000 ($3,700) of gross monthly wages to all new local hires for up to 12 months.

It pays half of the first S$6,000 ($4,400) of gross monthly wages for up to 18 months when the worker hired is 40 or older, has disabilities or is an ex-offender.

Singapore also launched the Enabling Employment Credit (EEC) in January providing wage offsets to employers who hire Singaporean people with disabilities earning below S$4,000 ($3,000) per month. For such employers, the Singapore government provides a 20% wage offset of each eligible Singaporean worker’s monthly income, capped at S$400 per month.

For employers who hire a Singaporean person with a disability for a job paying below S$4,000 ($3,000) per month and the worker has not been working for the past six months prior to being hired, there is an additional 10% wage offset which is capped at S$200 per month for the first six months of employment. EEC will be available for five years from 2021 to 2025.

Both JGI and EEC are automatically assessed based on the employer’s mandatory monthly Central Provident Fund (CPF) contributions for employees.

Mayumi Soh of Pinsent Masons MPillay, the Singapore joint law venture between MPillay and Pinsent Masons, the law firm behind Out-Law, said: “The objective of the JGI is to support employers in their hiring of local employees. However, it remains to be seen if these jobs are going to be held by local employees in the long term, after the support payouts stop.”