When a new tiered system for approving S Passes is introduced in July, about 70,000 foreign workers are at risk of not having their S Passes renewed when they expire.
The new system stipulates that more experienced pass holders have to be employed at higher pay to continue working here.
The policy, said experts, is aimed at levelling the playing field for Singaporean workers, who may be losing out to foreign counterparts with the same qualifications and experience because the latter command lower pay.
The Ministry of Manpower (MOM) said about one in two S-Pass holders will be affected by the new system.
There were 142,400 S-Pass holders here as at the end of last year.
S-Pass holders are mid- skilled foreign workers who earn at least $2,000 a month. This will be raised to $2,200 from July when the new tiered system will also kick in.
Older applicants who have better qualifications and more years of experience will now need to be employed at higher minimum pay in order to secure their S Passes.
Exactly how much higher will, however, not be known because MOM will not be giving details of these salary tiers.
The ministry said the tougher requirements are meant to "level the playing field for locals" and encourage employers to bring in "higher calibre S-Pass holders".
Employers told The Straits Times that the changes will force them to relook the pay of their mid-skilled foreign workers.
Some prefer to hold on to experienced S-Pass holders instead of finding local replacements, and would raise pay if need be.
OCBC economist Selena Ling expects the "wage shock" to be significant, especially for industries where local replacements are hard to get.