Last year was one of waiting as the implementation of several manpower policies was delayed to give companies time to adjust. This year promises to be more exciting.
The most anticipated move is the prospect of having different CPF Minimum Sums for different groups of people, which Manpower Minister Tan Chuan-Jin hinted at in an interview last month.
The first big announcement on the Central Provident Fund is due at the end of this month, when a government-appointed review panel is expected to announce the first set of recommendations on the Minimum Sum and withdrawals. Later this year, the panel will give its proposals on how CPF members can seek higher returns through private investment plans.
The changes will affect more than 1.9 million active CPF members.
The Minimum Sum is the amount that must be set aside in the CPF for retirement needs when a member turns 55. Half can be in the form of a pledge from a property purchased with CPF savings.
While the prospect of different Minimum Sums is appealing to those who have the amount - now $155,000 but to be increased to $161,000 in July - those hoping for a lower bar will be disappointed. The Government is unlikely to back-pedal on this front.
Also, one wonders if more help will be given to workers to boost their CPF savings. After all, only half of CPF members met the Minimum Sum in 2013, including 15 per cent who pledged their properties.
Over time, the proportion of CPF members meeting the Minimum Sum will go up, especially after the CPF contribution rates go up by between 1 and 2.5 percentage points from this month.
Employers are now required by law to rehire older workers who reach the retirement age of 62 until age 65, if they are healthy and have performed satisfactorily.
From this month, companies that voluntarily rehire them after 65 will get financial help. An incentive package is expected to be announced in the next two months and backdated to January.
Expectations from companies are high. Employers want wage subsidies and help with health-care costs for older workers.
"It is undeniable that costs go up when firms hire older workers. Some workers may be less productive," said Mr Kurt Wee, president of the Association of Small and Medium Enterprises. SMEs hire about seven out of every 10 workers here.
Tight labour market
The labour market is expected to remain tight this year with nearly full employment, putting upward pressure on wages, say economists. "The foreign labour restrictions continue to have the most impact for jobs in the lower- and middle-skill categories," said assistant economics professor Walter Theseira of Nanyang Technological University.
This means that sectors such as retail and food and beverage, which traditionally rely on foreign workers, will continue to struggle to find local workers. Companies will also feel the squeeze from restructuring. Productivity growth has been weak since economic restructuring began in 2010.
This year, which marks the midpoint of the 10-year restructuring plan, is a do-or-die year for firms as time will start running out for them soon. New labour chief
A key player helping workers cope with changes is the National Trades Union Congress (NTUC).
The union body will see changes to its top leadership this year. Its Central Committee, the highest decision-making body, is due for re-election by the end of this year.
NTUC secretary-general Lim Swee Say turns 61 in July and will be stepping down when he turns 62 in July next year, due to a self-imposed NTUC rule to encourage union leadership renewal.
Last month, Prime Minister Lee Hsien Loong said that a successor will be named "within a few months' time". The labour chief post is closely watched because it is a Cabinet appointment.
Meanwhile, the Fair Consideration Framework, which kicked in last August, requires firms to prove that they tried to hire Singaporeans first by posting job advertisements for 14 days at the national jobs bank, before they are allowed to recruit foreign professionals.
Come August this year, at the one-year mark of the move, the Ministry of Manpower is expected to produce evidence to persuade Singaporeans that the model achieves its purpose of giving Singaporeans a fair shot at PME - professionals, managers and executives - jobs. Otherwise, Singaporeans will remain sceptical about the approach and question if it has more bark than bite.
In a nutshell, if 2014 was the year when workers waited for changes to take place, 2015 will likely be the year when they feel the impact of CPF changes, while firms continue to bear the brunt of the tight labour market and economic restructuring.
This article was first published on January 8, 2015.
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