HR News & Trends: Jan Week 2

HR News & Trends: Jan Week 2

HR News & Trends: Jan Week 2

1. Market Trends

i. 6 in 10 Singaporeans Concerned About Skills Gap: WEF

A recent World Economic Forum (WEF) report highlights concerns among Singapore firms and key employment trends:

  • Skills Gap: 60% of businesses predicting that these gaps will impede transformation. This figure is slightly below the global average of 63%.
  • Impact of Geo-Economic Fragmentation: 64% of employers expecting it to affect their business, double the global average.
  • Reskilling and Upskilling: 70% of the workforce are projected to require substantial upskilling or reskilling by 2030, and 97% of companies plan to prioritise upskilling as a key workforce strategy, alongside automation.
  • Market Churn: The structural labour market churn in Singapore is forecast to be 28%, higher than the global 22%.
  • Hiring Trends: Singapore leads the global trend in AI adoption, with 97% of organisations using AI. However, 58% of employers still prioritise university degrees when hiring, surpassing the global average of 43%.

Takeaway: In light of these trends, industries reliant on traditional skills, such as agriculture and construction, are expected to grow, while roles impacted by AI, such as graphic designers, will decline.

 

ii. More Japanese Firms Seek Salary Hikes

A wide range of Japanese companies see the necessity of raising wages to address structural labour shortages. Nonetheless, smaller businesses remain cautious due to rising costs and their impact on profitability.

Takeaway: This reflects a shift toward sustained wage growth in the country and is also critical for tightening monetary policy. These developments will influence the BOJ’s upcoming monetary policy meeting, where an interest rate hike from the current 0.25% is being considered.

 

iii. Japan May See a Decline in Deaths from Overworking

Japan’s work culture, long characterised by long hours and self-sacrifice, is undergoing a significant shift. Younger workers are moving away from “grind culture,” opting for shorter workweeks and improved work-life balance. In recent years, annual working hours have dropped by 11.6%, bringing Japan’s work hours in line with many European nations. This change is most evident among men in their 20s, who now work fewer hours than previous generations.

Takeaway: The shift reflects a generational change, with younger workers prioritising personal time over economic growth and job security. This cultural shift could contribute to a decline in “karoshi” (death from overwork) and marks a potential change in the country’s workplace dynamics.

 

2. Market Policies

i. JS-SEZ to Encourage Investments and Creation of 100 Projects, 20k Jobs

Following the establishment of the Johor-Singapore Special Economic Zone (JS-SEZ), 100 projects are expected to be created in 10 years, alongside 20,000 skilled jobs. More investments are also expected across 11 key sectors, including manufacturing, logistics, energy, and education, highlighting diverse opportunities for workforce development. Key highlights include:

  • Talent Development: Both countries will prioritise industry-ready skills training and education programmes to build a skilled workforce.
  • Talent Mobility:
    • Malaysia is introducing improved foreign-worker passes, like the DE Rantau Nomad Pass, which allows non-IT and non-digital foreign talent with a minimum monthly income of US$5,000 to live in Malaysia for up to a year in the first instance.
    • Streamlined immigration processes, including automated lanes and paperless goods clearance, will ease cross-border movement for employees and goods.
  • Business Incentives: Malaysia will offer a tax incentive package for the JS-SEZ, including a preferential corporate tax rate for companies making new investments in high-growth, high-value-added sectors within the zone.

Future Plans: Malaysia and Singapore affirmed their commitment to identifying new avenues of collaboration to advance the goals of the JS-SEZ. This includes evaluating opportunities to improve market access for financial institutions and ensuring compliance with the legal and regulatory frameworks of both nations.

Takeaway: As the regional hub for many global companies overseeing operations across Southeast Asia, Singapore is well-positioned to foster enhanced cross-border collaboration.

 

    Discover More Industry Trends with JC

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    Image Credits:

    • Reuters
    • Straits Times