Bloomberg News

Singapore Must Be Careful Not to Overdo Labor Curbs, Lee Says

May 01, 2013

Singapore must avoid going too far on foreign-worker curbs to remain competitive in attracting businesses and investors, Prime Minister Lee Hsien Loong said.

The island should be careful not do “overdo” measures to restrict the inflow of overseas labor as it will raise the cost of doing business and make it harder for companies to operate in the city-state, Lee said in a Labor Day speech to more than 1,000 union leaders and members today.

“If we make it too difficult for companies to get their skills and talent which they need here, they will go elsewhere,” Lee said. “Investors are watching us closely. We must not send the wrong signal that Singapore no longer welcomes business or that they are turning away talent.”

Singapore increased curbs on overseas workers for a fourth straight year in February and unveiled measures that will result in higher wage costs for companies through 2015, as the government steps up efforts to increase productivity. A protest is planned today over labor policies that some Singaporeans say are hurting low-income earners and forcing citizens to compete with foreigners for jobs.

The island’s job market will remain “tight” this year as demand for workers outpaces supply amid the restrictions on foreign labor, the Monetary Authority of Singapore said in a report yesterday.

Protest Scheduled

Several thousand protesters gathered at the edge of the city’s financial district in February to demonstrate against a government plan to increase the island’s population through immigration. Organizer Gilbert Goh, who runs a non-governmental group to help unemployed citizens, is holding a second protest today and said issues such as the lack of a minimum wage may be raised.

Lawmakers from Lee’s party endorsed a set of proposals in February to allow more foreigners through 2030 to boost the workforce, which may help raise the island’s population to 6.9 million from 5.3 million.

While Singapore must manage the number of foreign workers, “we have to be very careful as we tighten up because business costs will go up, it will become harder for companies to operate here, our competitiveness can be affected,” Lee said. “Our costs of living can be affected because wages go up, costs go up, prices will follow.”

To contact the reporter on this story: Shamim Adam in Singapore at

To contact the editor responsible for this story: Stephanie Phang at

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