HR News & Trends: Nov Week 3 

1. Markets

i. Singapore Scrutinises AI Use in HR

The Singapore government is closely monitoring the use of AI in HR practices to ensure that regulations remain effective in preventing discrimination. Concerns about AI tools potentially introducing biases in hiring and promotions due to flawed data were raised by MPs, with calls for companies to be transparent about their use. Besides monitoring the use of AI, the government introduced:

• A model AI governance framework to encourage responsible AI use.
• A new bill to protect workers from discrimination in five key areas—nationality, age, sex, race, and disability. Employers found guilty of discrimination could face fines and lawsuits.

Takeaway: The impact of this development on the HR industry lies in the increased scrutiny and accountability around AI adoption in hiring and employee evaluations.

ii. Singapore Rolls Out Workplace Fairness Bill

Singapore’s Parliament introduced the Workplace Fairness Bill to strengthen protections against workplace discrimination. The legislation aims to entrench fair and merit-based employment practices, addressing discriminatory behaviours in hiring, dismissals, and appraisals. Key features include:

• Prohibited Discriminatory Characteristics: Employers will be prohibited from making employment decisions based on nationality, age, gender, marital status, pregnancy, caregiving responsibilities, race, religion, language, disability, or mental health.
• Two-Phase Implementation: The legislation will roll out in two parts, with full implementation expected in 2026 or 2027, giving employers time to adapt.
• Corrective and Punitive Measures: For the first time, serious breaches will attract penalties, including fines and civil lawsuits. Employers must also implement grievance-handling processes to address discrimination complaints.
• Flexibility and Exemptions: Employers may specify job requirements based on operational needs (e.g., language skills, gender-specific roles) and are allowed practices supporting national objectives, such as favouring disabled workers. Smaller businesses with fewer than 25 employees are exempt for five years post-enactment.
• Enhanced Worker Protections: The Bill ensures confidentiality in grievance processes, prohibits retaliation and provides avenues for workers to claim up to $20,000 ($30,000 for union members) for proven discrimination cases.

Takeaway: The Bill complements existing guidelines under the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP). While discriminatory cases have dropped significantly in recent years, this legislation seeks to address gaps and provide stronger recourse for affected workers. Employers and HR leaders are advised to proactively review and update their employment practices to align with these forthcoming changes.

2. Market Trends

i. Tech Knowhow and Diverse Skills Crucial in Fintech

At the Singapore FinTech Festival, industry leaders highlighted key trends that are shaping the talent landscape in the fintech and financial services sectors.

• A cautious hiring outlook is evident, with 57% of financial institutions either freezing hiring or reducing headcounts for tech roles.
• However, fintech firms show slightly more optimism, with 27% planning to increase their tech workforce.
• AI adoption is widespread, with 94% of banks and asset managers exploring its use in sales, marketing, and data management.
• Firms are adopting flexible workforce models and outsourcing non-core capabilities while focusing on internal talent development for strategic, long-term roles.
• The industry is also focusing on refining employee benefits to attract and retain top talent. This includes offering learning and development budgets, flexible leave policies and work arrangements, health benefits, lifestyle discounts, and employee recognition and engagement.

Takeaway: Given that employees largely view rewards and opportunities as the key factors for joining or leaving a company, redefining employee benefits to support flexibility and continuous learning will be crucial in talent attraction and retention.

ii. Singapore’s 2025 Salary Growth the Lowest in SEA

Singapore’s salary growth is projected to rise by a modest 4.4% in 2025, the lowest among Southeast Asian countries, as per the 2024 Salary Increase and Turnover Study. This restrained growth reflects employers’ efforts to balance rising costs with the challenge of attracting and retaining top talent in a competitive market. Key findings include:

• Regional Comparison: Singapore and Thailand have the slowest salary growth in the region, with countries like Vietnam (6.7%) and Indonesia (6.3%) expecting significantly higher increases.
• Sector Dynamics:
  • High-growth sectors: Manufacturing and tech lead salary increases at 5.8%, driven by demand in areas like cybersecurity, AI, and machine learning.
  • Lower-growth sectors: Transportation and financial services see smaller adjustments, with transportation at just 4.1%.
• Talent Challenges:
  • Retention pressure: 64% of companies in Singapore report difficulties retaining talent, leading to strategies focusing on core teams and individual contributors.
  • Attrition rates: Consulting and life sciences show high turnover rates, reflecting shifting workforce dynamics and talent strategies.
• Talent Demand: Roles in cybersecurity, AI, and engineering continue to see double-digit compensation growth.
• Company Strategies:
  • Salary strategy: To manage costs, companies are reducing new hire premiums and using data-driven approaches to allocate salary increases to critical roles.
  • Headcount strategy: Organisations are expanding headcount selectively, with one in three firms planning up to a 20% increase, focusing on skill shortages and growth areas.

Discover More Industry Trends with JC

For the latest industry trends or to explore new career opportunities, connect with our HR recruitment consultants for a chat. With executive search firms in Singapore and China, and operations in key business hubs like Hong Kong, you can count on our team for timely access to regional insights that can create synergy for your career and operations.

For employers: Beyond the HR industry, we also have dedicated desks for several sectors that enables us to meet your varied recruitment needs:

• Financial services recruitment
• Life sciences recruitment
• Luxury & retail recruitment
• Legal recruitment
• Tech recruitment

Image Credits:

• Singapore Fintech Association