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Oral Answer by Mr Tan Chuan-Jin, Minister of State for National Development and Manpower, to Parliamentary Question on young PMETs and contract employment

Notice Paper No. 71 of 2011 for the Sitting on 17 January 2012
Question No. 30 for Oral Answer.

MP: Mr Alex Yam Ziming

Question:

To ask the Deputy Prime Minister and Minister for Manpower (a) what is the current employment rate for fresh graduates from polytechnics and universities; (b) whether the number of young PMETs on contract employment has increased in the past five years; and (c) whether his Ministry will consider requiring employers to offer fair employment benefits to employees on permanent renewable contracts.

Answer

  1. We try to ensure that we provide a strong foundation for all Singaporeans by education and continuous training. This is a draw for companies operating here, both local and foreign .We also watch the employment landscape very carefully so that our young Singaporeans have good career opportunities and can grow. From the 2010 Graduate Employment Survey (GES), over 9 in 101 polytechnic and university graduates who entered the job market in 2010 were employed within six months.
  2. In the past five years, among employed resident PMETs aged 20-29, the proportion of those on contract employment decreased slightly from 12.3% (or 20,600) in 2006 to 11.3% (or 21,200) in 20102. Amongst all resident employees, the proportion on term contracts has fluctuated between 12% and 13%3.
  3. Term contracts are part of the employment landscape. Companies generally hire employees on term contracts for two main reasons. First, contract employees provide greater flexibility for companies to manage their costs in an environment of increased global competition and shorter and less predictable business cycles. This is true globally – outsourcing and non-traditional employment arrangements including term contracts have become more common. Second, there are also occasions where companies need to turn to contract employees with specific skill sets not available within the company for fixed-term projects or assignments. Some companies may also place an employee on a term contract for a specific period while they assess the employee’s competency and suitability for long-term employment. Further, some employers may pay a premium to their employees to compensate for the short-term nature of certain contracts in certain professions where skills and expertise are in demand. In general, it provides flexibility for the market.
  4. However, let me emphasise, regardless of whether employees are on term or permanent contracts, we are able to look after our workers. They are protected under our employment legislation, such as the Employment Act, CPF Act, Work Injury Compensation Act and Workplace Safety and Health Act.
  5. Notwithstanding this, employers should consider converting their contract employees into permanent staff if they are found to be suitable for the job and if the job is in fact expected to be available on a permanent basis. This will provide greater employment certainty to the employee and help enhance employee engagement.

 

1 91% of university graduates, 92% of polytechnic fresh graduates and 95% of polytechnic post-NS graduates.
2 Despite the lower percentage in 2010, the absolute number of PMETs aged 20-29 on contract employment is higher in 2010. This is due to the increased base of employed resident PMETs aged 20-29 from 2006 (168,200) to 2010 (187,400).
3 Report on Labour Force in Singapore, 2010