Budget 2012 Singapore, New Influences to Business 2 – Local Workforce
During the announcement of the Budget 2012, the government expressed that it will tighten foreign worker policies and quotas starting on the 1st of July. As a result, entrepreneurs who are looking to incorporate a business in Singapore will no longer be able to hire as many foreign talent as they want. The businesses are required to abide by the quota set by the government in employing foreigners and are encouraged to hire local talents.
This Budget 2012 seeks to the local workforce. How will companies incorporated in Singapore and other businesses become more willing to hire more local workforce? The answer is simple—incentives. One of the key reasons for becoming an entrepreneur is generating a profit. These incentives will be given to older workers, early retirees, and homemakers to boost the local workforce. Employers will get a Special Employment Credit (SEC) for hiring Singaporean workers who are above 50 years old and who earn up to $3,000 a month. The SEC will be 8 percent of wages and will cover almost 350,000 workers, or four-fifths of older Singaporean workers, including workers who are earning between $3,000 and $4,000, who will receive a smaller SEC. This enhanced credit scheme was first introduced last year. It will be in place starting September of this year up to 2016, in order to allow employers space to hire older workers.
Over and above the SEC, all small and medium enterprises will receive a one-off cash grant of five per cent of their revenues in the year 2012, capped at a payout of $5,000, as long as they have been making CPF contributions to at least one of their employees.
With the help of government, the rate of local workforce employment will be refreshed. Hence, entrepreneurs who want to start a business in Singapore must not be alarmed.