This article first appeared on MoneySmart's What is being done to help Singaporeans keep their jobs instead of unemployment insurance
Taylor Swift insures her legs, but unfortunately for Singaporeans, you're not going to be able to do the same for your jobs. If you lose your job, you're on your own. Except… guess what! The government says that what we have is even BETTER than unemployment insurance! Gee whiz, imagine that!
That quote is a reference to the various schemes the government has come up with to help victims of unemployment find jobs, and to become more unemployable.
The Career Support Programme is one of the initiatives displaced high earners should thank the gods for, since it's targeted at mid-career PMETs and not low-skilled workers who can instantly become more employable and boost their income by taking a single skills-upgrading course.
The programme basically dangles incentives at employers to hire older PMETs who have been retrenched or unemployed for over 6 months. The government will pay a certain percentage of the worker's salary to the company, thereby subsidising the cost of hiring them.
Still crying about how there should be unemployment insurance? Here are three reasons it might actually be a good thing it doesn't exist here.
Lack of unemployment insurance might encourage Singaporeans to stay employed
Retrenched workers who are desperately trying to look for a job and have done all they can to keep their skills upgraded but still find themselves being rejected by ageist employers might find themselves praying a job, any job, will present itself as soon as possible.
But there are a number of older workers would might actually choose to stay out of the workforce for longer periods if there were unemployment insurance, as the urgency of finding a job just isn't as pressing if your basic needs are already being taken care of.
The government is already trying to encourage Singaporeans to keep working in order to ensure the economy keeps chugging along, so pushing employees to get back into the workforce as soon as possible is the smartest way to achieve this goal. Unfortunately, unemployment insurance seen as something that goes against this.
One problem with this policy is that retrenched Singaporeans can be so desperate to find work they take on jobs that they are overqualified for, such as in the case of engineers turning to taxi driving. While Singapore continues to enjoy a low unemployment rate, underemployment is mild but a growing problem.
While SkillsFuture appears to be a step in the right direction, in time to come professional associations may have to step in to provide more targeted help.
The government prefers to offer money to people to work, rather than to not work
The government has always been averse to giving people money for nothing, for fear that people will get lazy and start asking for handouts. It's a story we're all so familiar with we can effortlessly parrot these lines whenever social safety nets are being discussed.
The good thing about substituting unemployment insurance with the Career Support Programme is that the money flowing out of the government's coffers isn't given to people who are doing nothing-rather, they make up part of the employee's salary.
In effect, the government is therefore paying people to work, which once again reinforces the message that you've got to make the effort if you want help.
Skills upgrading and staying relevant will help Singaporeans for a much longer period of time
It sounds harsh, but many older PMETs are retrenched because they've become obsolete over the years. | It's not always their fault-the types of jobs that companies have decided to base in Singapore have changed over time, and just because you've been doing the same thing for over 20 years doesn't mean that your company might not decide to relocate your job function to a different country.
Other employees have simply gotten too complacent and let their skills stagnate, to the point where younger, cheaper workers are able to do their jobs and more.
Both groups can benefit by skills upgrading, whether through SkillsFuture initiatives or otherwise.
With the help of the Career Support Programme, employees will have a greater incentive to hire older PMETs who've been diligently re-skilling, rather than getting 20-somethings to do the same work.
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