Foreign Graduates in Singapore Universities Hit Hard in Local Employment Market

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Foreign graduates from Singapore universities are facing uncertainty over employment due to raised minimum salaries for hiring foreigners on work passes. This is exacerbated by the fact that those who receive subsidies from the Ministry of Education (MOE) under the Tuition Grant Scheme (TGS) must serve a three-year bond in a Singapore-registered company upon graduation.

How are they affected?

A point to note is that the TGS does not guarantee its recipients a job upon graduation. Contractually, graduates are required to seek their own employment with a Singapore entity. Breaking their bond, i.e., not being able to find employment within a year of graduation, could result in a hefty pay back fee of $100,000.

How bad can it be?

Six out of 10 international students interviewed by The Sunday Times have not been able to land a job in the past four months. One student from India had sent out 60 applications in the past three months but had only been shortlisted for two interviews. She was also told straight up by a company that they could not afford to hire her on an Employment Pass (EP).

Another recent graduate from Australia, Ms Minh, had also applied for up to 100 jobs. While she was offered employment in April, the job was rescinded just two weeks later after the company enforced a “no more EPs” rule.

Blame it on COVID-19

Needless to say, the global pandemic has hit the economy hard, with unemployment rates rising in the second quarter to 2.9% from 2.4% in the previous quarter, according to the Ministry of Manpower’s (MOM) Labour Market Report. A growing pool of unemployed workers have also saturated the labour market, as retrenchments have more than doubled to 6,700 in the second quarter from 3,220 the previous quarter.

Pushing for Singaporeans first

In the midst of this crisis, MOM has been encouraging Singapore companies to retain and hire Singaporeans. Changes to foreign work pass holder policies have also been made to discourage the hiring of foreigners, such as in baseline salaries. Newly hired EP holders are now required to be paid $4,500 instead of $3,900 from 1 September, and S Pass holders will be required to be paid $2,500 instead of $2,400 from 1 October.

The implementation of the SGUnited Traineeships Programme in June is also an incentive for Singapore companies to hire local graduates. Open to Singaporean and Permanent Resident graduates from 2019 and 2020, the traineeships act like internships and are mostly short-term entry-level jobs for young locals to gain valuable industry experience during this economic downturn. As the Singapore government funds up to 80 per cent of a local trainee’s monthly allowance, again, Singapore companies have less of a reason to hire foreign graduates during this time.

Anti-foreigner strife

Although plans have been rolled out by MOM to keep a core Singapore workforce, it is understandable that locals might still feel resentment towards foreigners who are also competing for the limited jobs available.

Discussions on this topic on local forum Hardwarezone showed that many were unsympathetic towards these foreign graduates serving bond. Some called these foreigners who have come in on the TGS “entitled” and have even blamed them for taking the risk of coming here and for “stealing [Singaporeans’] jobs”.

Over at Reddit, however, points were made on the effectiveness of handing out grants through the TGS. u/peregoriot13 highlighted that the TGS enables local institutions to attract talented students to “develop some cultural depth and sophistication among the student body”. u/dynasty987 also added on that the investments made in foreign students does help Singapore on a whole, as they contribute effectively to the development of the economy during their bond and beyond.

But, as u/Christiary points out, it may be time to rethink how the TGS is given out to foreigners. “The real conversation to be had is whether we should be giving tuition grants to foreigners pursuing non-professional degrees, and whether we need to scale back the system as the job market gets tougher,” he said.

The report done by MOM showed that industries, such as arts, entertainment and recreation, and education faced the sharpest contractions this year. Industries hit by COVID-19 restrictions, such as travel-related sectors will remain very challenging in the years to come.

Beggars can’t be choosers

Ultimately, foreign graduates here say they have little say in the matter and are just hoping to be able to serve their bond to the best of their abilities before their passes expire. Said Ms Minh, “The reality is foreigners don’t have the choice to be picky. I would literally have taken anything, as long as I could get started on my career.”

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