Running head: FOREIGN TALENTS 1

The Impact of Hiring Foreign Talents Instead of Grooming Locals for our PMET Roles in

Singapore

Name

Institution
FOREIGN TALENTS 2

Contents
1. Abstract........................................................................................................................................2
2. Introduction..................................................................................................................................3
3. Body.............................................................................................................................................4
3.1 Background............................................................................................................................4
3.2 Understanding Concepts........................................................................................................6
3.2.1 Local Workers................................................................................................................6
3.2.2 Foreign Talents...............................................................................................................6
3.3 Foreign Talent Regime in Singapore.....................................................................................7
3.4 Sources of Foreign Talents in Singapore...............................................................................9
3.5 Reasons Making Singapore Dependent on the Foreign Labor............................................10
3.6 Effects of Expatriate Labor in Singapore............................................................................11
3.6.1 Positive Effects of Expatriate Labor in Singapore.......................................................11
3.6.2 Negative Effects of Expatriate Labor in Singapore......................................................14
3.7 Effective Strategies Singapore can Implement to Avert Overdependence on Foreign Labor
...................................................................................................................................................18
4. Conclusions................................................................................................................................20
References......................................................................................................................................22

1. Abstract

Many developed economies depend on a knowledge-based workforce to sustain their

economic prosperity and improve their international competitiveness. Singapore is an example of

a country that depended on a knowledge-based workforce to sustain its economic success.

Singapore has implemented various reforms in a post-independent era, including liberalizing its

economy and optimizing economic freedom to maximize its global competitiveness. Economic

liberalization in Singapore is a major driver of its massive economic prosperity from a backward

nation into an industrialized nation. Until the 1990s, Singapore depended on foreign investment

to sustain its economy and offer jobs to the locals. However, this changed in the late 1990s when

the country’s focus shifted towards a knowledge-based economy. Singapore recognized that its
FOREIGN TALENTS 3

sustained growth rested on a knowledge-based economy. However, Singapore could not achieve

this by investing in talent attraction and development. As a result, Singapore implemented

reforms to develop local talents to address the talent gap. Despite the local talent development

success and its meritocratic rise, Singapore recognized that it needed a wider pool of skilled

professionals, executives, and experts. While the foreign talent was crucial in addressing skills

gaps and bringing diversity in the workplace, it threatens local jobs, encourages workplace

discrimination, wage depression, and dilution of cultural identity. This paper addresses the bright

sides and shortcomings of investing in foreign talents over developing local talents. Undeniably,

immigrant workers are beneficial to an economy but come with various unplanned effects

mentioned above. Therefore, the Singaporean government must control immigrant workers to

avoid hurting the jobs and other unexpected economic effects.

Keywords: Expatriates, immigrant workers, foreign talents, local talents 

2. Introduction

The issue of expatriate talents has received massive public and media attention in

Singapore. However, research on foreign talents' impacts on the local economy instead of

grooming locals for PMET (professionals, managers, executives, and technicians) roles in

Singapore receives minimal attention (Tan & Taeihagh, 2021). Undoubtedly, attracting and

hiring foreign talents in a country have unprecedented and unplanned dual effects explained

below (Wang et al., 2018). From a negative perspective, it weakens local talent development and

takes jobs that the locals could do. On the bright side, foreign talents bring a highly talented

labor pool and address the talent gap in an economy (Tan & Taeihagh, 2021). The bright sides

mentioned above explains why Singapore and other countries import labor in their country.

Although Singapore is a major destination of the imported labor, researcher hardly focuses on its
FOREIGN TALENTS 4

impacts on the local talents. Therefore, this informed this research topic (Mandal, 2013). This

paper borrows from the literature sources to examine the role of imported labor instead of

grooming local talents for PMET roles in talent development across Singapore. 

3. Body 

3.1 Background

One cannot discuss foreign talent hiring in Singapore without discussing the economic

development context. The journey to Singaporean economic prosperity began in the mid-1960s,

immediately after independence (Wang & Hooi, 2019). In post-independent Singapore, the

economic revolution is categorized into two phases. The first phase began in the 1960s and

ended in the 1990s, while the second phase is the post-2000 era until the date (Tani, 2020; Marsh

& Oyelere, 2018). During the first phase, the FDI (foreign direct investment) was the primary

economic engine for the country (Marsh & Oyelere, 2018). As a result, the government

implemented radical measures, especially liberalizing the economy and promoting massive

economic freedom (Marsh & Oyelere, 2018). Today, Singapore is the freest economy, reflecting

its superiority and attractiveness in attracting FDI (Wang & Hooi, 2019). Limited natural

resources (minerals, ores, vegetation, and metals) also drove Singapore to adopt an export-

oriented strategy to induce economic growth and development. In addition, Singapore set itself

as a top destination for multinational enterprises in the country by providing one-stop services,

including but not limited to industrial estates development, tax holidays, and grooming the local

talents (Amankwah‐Amoah, 2020). According to commentators, this economic model proved a

success (Mandal, 2013). As of the late 1970s, Singapore was among the four fastest-growing

Asian economies popularly referred to as “Asian Tigers” and Taiwan, Korean Republic, and
FOREIGN TALENTS 5

Hong Kong (Tani, 2020). The impressive economic boom and industrialization in the four

countries caught the world by surprise.  

However, the major challenge that could impede the above economic gains in Singapore

was the underdeveloped workforce. In the late 1990s, the enormous labor shortage encouraged

Singapore to shift its focus and recognize the need to attract foreign talents while grooming the

local talents to suit the workforce's growing demands (Lanvin, Evans, Rodriguez-Montemayor,

Lanvin, & Evans, 2017). Although the foreign talent development intensified in the early 2000s

during the second economic, the beginning of the imported labor search began as early as the

1980s (Shu-Xin & Meng-Li, 2019). At the time, Singaporean economic policies shifted towards

transforming Singapore into a knowledge-based economy (Shu-Xin & Meng-Li, 2019). In

foreign talent attraction, Singapore adopted various wide range initiatives. For instance, in 1998,

the government formed the STAR (Singapore Talent Recruitment) Committee to attract and

retain a foreign workforce (Wang et al., 2017). The main responsibility of the STAR Committee

was to market Singapore in the overseas markets by providing information on working, studying,

and living, and opening business in Singapore by foreigners (Hof, 2018). Therefore, this

established Singapore as an attractive market for foreigners to hunt for jobs in the country.

Besides attracting foreign professionals to the country, Singapore also sought to attract

foreign students (Srichampa, Burarungrot, & Samoh, 2018; Mandal, 2013). In addition,

Singapore advances many scholarship programs for foreigners to study abroad (Lanvin et al.,

2017). Offering scholarships is an effective way that Singapore uses in spreading its soft power,

especially its image and international reputation.

From the above, it is evident that the talent search in Singapore has its history since

independence in 1965. The critical background information is critical to interrogate and

FOREIGN TALENTS 6

understand the rationale behind foreign talent attraction and development in the country.

According to the background information, economic growth and competitiveness were the main

engines driving foreign talent development and attraction in Singapore.

3.2 Understanding Concepts

3.2.1 Local Workers

Local talents (workers) are nationals working in their home country (Mohamed,

Ramendran, & Yacob, 2012). Unlike foreign talents, recruiting and hiring local talents is not

complex because it does not involve immigration regulations, including work permits and

residency status (van Riemsdijk & Basford, 2021). Furthermore, governments support local

talents to improve their comparative advantage by reducing workforce shortages to work

industries (Mohamed et al., 2012). For example, the government may invest in education and

vocational training to equip people with relevant and critical skills to achieve a competitive

advantage. 

3.2.2 Foreign Talents

Foreign talents are expatriate employees hired to work in other countries (Mohamed et al.,

2012). Therefore, they are non-locals working in foreign countries. Mostly, foreign recruitment

agencies and companies in other countries are responsible for attracting and selecting foreign

talents in an economy (Liu & Zhang, 2017). Foreign talents entail skilled, semi-skilled,

unskilled, documented, and undocumented workers in a country. According to the UN (United

Nations) Convention on the migrant workers’ protection, expatriates are hired people engaged in

compensatory activity outside their home country (Peeters, Mills, Pennings, & Sung, 2019.

Many countries, especially developing nations, including Mexico, the Philippines, and Brazil, are

signatory to this convention. However, the wealthy countries that include Japan, the USA, and
FOREIGN TALENTS 7

Germany are yet to ratify this convention besides being dependent on the foreign labor supply.

Enacting this convention was essential to protecting immigrant rights outside their territory

(Wang et al., 2018). Notably, protecting migrants’ rights is a cornerstone to incentivizing foreign

labor supply. Therefore, this explains why all countries need to join efforts in protecting migrant

rights within and outside their countries.

3.3 Foreign Talent Regime in Singapore

Understanding the foreign talent regime in the country (Singapore) is essential in this study

to determine the legal background behind importing foreign labor. Multiple literature sources

provide credible and informative insights on the Singaporean foreign talent regime. According to

Yang, Yang, and Zhan (2017), the Work Pass System is the primary policy instrument used by

Singapore in regulating foreign labor imports. Broadly, this system establishes immigration and

selection criteria in Singapore. Work Pass System involves three major categories, including the

Work Permit (WP), Employment Pass (EP), and S Pass (SP). Any foreigner hunting for jobs in

Singapore must apply for any of the three categories mentioned above. Each of the three

categories is meant for different purposes.

While WP is a legal requirement for unskilled and semi-skilled labor, the S Pass is for mid-

skilled labor (Yue, 2011). On the other hand, EP is legal fulfillment by foreigners for highly

skilled labor. Mainly, the WP involves low-wage jobs, particularly in the construction and

manufacturing industries. The S Pass commands at least S$2,200 monthly salary, and job holders

must have at least a bachelor's degree or diploma in education attainment (Yue, 2011). The EP is

for the highly skilled executives and managerial jobs commanding at least S$12,000 in monthly

salary (Yue, 2011). It is also for highly skilled experts attracting at least S$3,600 in monthly

salary (Yue, 2011). In addition, the EP applicants must have relevant qualifications, including
FOREIGN TALENTS 8

university degrees, specialist skills, and relevant experience (Quyen, 2019). EP holders are also

eligible for the PEP (Personalized Employment Pass), which provides higher flexibility

concerning the rules governing the holders’ stay and entry in Singapore (Ho & Tan, 2020).

Besides the three major pass categories, there is also an Entrepass, established for the foreign

entrepreneurs seeking business opportunities in Singapore. 

In Singapore, expatriates can only work on the jobs specified under the WP (work permit),

and an employer terminates the employment contract once the job ends (Litsareva, 2017).

Therefore, the negative implication of this is that a work permit does not guarantee job security.

Furthermore, expatriate workers under WP (Work Permit) experience certain challenges

(Constable, 2020). For instance, they are ineligible for permanent residency, cannot marry a

Singaporean, and may not bring immediate relatives or family members into Singapore. In

addition, female expatriates are ineligible for childbirth and pregnancy in Singapore (Brown,

Sadik, & Souto-Otero, 2021). Therefore, WP holders have minimal entitlements as compared to

the citizens. 

In contrast, EP and S Pass holders earning at least S$5,000 are eligible for entitlements that

WP holders are ineligible (Yue, 2011). For example, EP and SP holders earning S$5,000 can

bring their immediate family members, marry locals, and give birth in Singapore (Kuah, Kim, &

Le Queux, 2020). In addition, EP and S Pass holders are eligible for permanent residency in the

country (Kuah et al., 2020). In addition, however, the S Pass and the WP holders are eligible to

pay government taxes and levies to reduce the country’s dependence on foreign labor. Singapore

also implements an open-door policy to attract and maintain expert and professional labor (Yue,

2011). Naturally, maintaining professional and highly skilled talents is a big challenge because

such employees understand their demand is high. Therefore, investing in attractive and
FOREIGN TALENTS 9

competitive policies to attract and maintain professional labor is necessary. Apart from attractive

salaries and fringe benefits, Singaporean employers provide exceptional life, amenities, and

environment to expatriates (Rajah, 2019). In addition, the eased requirement for expert labor is to

attract professionals. 

The above literature provides a concise overview of the Singaporean foreign workforce

regime. From the above, it is evident that immigration issues are synonymous with Singapore’s

foreign workforce regime. However, this is not different from other countries. Like Singapore,

other countries’ immigration regime is compatible with the immigration regime. In Singapore,

the Work Pass System is a foundation and most critical channel for Singaporean immigration.

The literature also clarifies that Singapore implements an immigration system to attract foreign

labor and simultaneously control the explosion of expatriates in the country.

3.4 Sources of Foreign Talents in Singapore

Singapore is a multiracial society, with the Chinese Singaporeans followed by Malaysian

Singaporeans being the top ethnic groups (Yue, 2011). Since Singaporeans are ethically Chinese

(76.4%) or Malaysian (14.7%), Singapore mainly targeted immigrants from their traditional

originality (China and Malaysia). The need to maintain racial harmony based on the traditional

ethnic groups is a major reason Singapore mainly prefers Malaysians and Chinese over ethnic

groups (Mok & Chan, 2020). Therefore, this implies that immigrant workers are restricted to

countries that reflect the ethnic composition of Singaporeans.

Ethnic compatibility is essential consideration during hiring for various inherent reasons.

Part of the major reason for sourcing immigrant workers from countries that reflect ethnic origin

is that it minimizes the cultural shock and language barriers (Yue, 2011). For example, hiring

Chinese reduces cultural shocks in Singapore because most Singaporeans claim Chinese ancestry
FOREIGN TALENTS 10

(Ho & Tyson, 2017). On the other hand, hiring people whose culture is so diverse from the local

culture may induce social problems in an economy (Zhan, Huang, & Zhou, 2020). Therefore,

this explains the preference for the Chinese or Malaysian, the two largest ethnic groups in the

country.

However, non-traditional destinations, especially India, the Philippines, Bhutan, and other

Southeast Asian countries, were significant expatriate labor in Singapore (Meyer & Xin, 2018).

An attraction for foreign talents was an effective way to foster dramatic economic growth and

advancement. Although Singapore prefers immigrant workers from East Asia or Southeast Asia,

it also welcomes skilled professionals, experts, and entrepreneurs from other countries (Kerr,

2020). Europe, Japan, Australia, South Korea, and New Zealand are some major developed

countries that provide skilled labor to Singapore (Kerr, 2020). Mostly, unskilled labor is from

neighboring Southeast Asian countries. 

3.5 Reasons Making Singapore Dependent on the Foreign Labor 

Enormous dependence on foreign labor is an area that attracts immense debate from

various scholars. A discussion of these factors is essential to identify salient talent-based

problems facing Singapore, driving it to promote foreign labor (Yeo et al., 2019). Part of the

major reasons discussed across the literature sources was the low supply of local talents (Yang et

al., 2017). Limited source of the local talents was a major driver that encourages Singaporean to

attract foreign talents to the country. 

Researchers also agree that Singaporeans pursued foreign talents to bring creativity and

innovation from the foreigners (Ortiga, 2021). At the height of the economic transformation in

the 1990s, Singapore needed development to improve its comparative advantage and transform it

into a knowledge-based economy (Robertson, Cheng, & Yeoh, 2018). Researchers also argue
FOREIGN TALENTS 11

that the need to upgrade Singapore into the economy was a critical factor in encouraging foreign

talent attraction (Meyer & Xin, 2018). According to Goh Chok, Singapore ex-premier in the

1990s stated that human talent, as opposed to physical resources, was the key to international

competitiveness (Yang et al., 2017). Chok’s sentiments reflect the country’s commitment to the

infusion of talents with resources to improve its competitive advantage. Therefore, this inspired

Singapore to attract a talent pool from foreigners. 

Yue (2011) also argues that the lack of skilled industrial capitalists and entrepreneurs

attracted foreign talents in Singapore. Upon economic restructuring and planning in the late

1970s, Singapore increased the search for foreign talents (Zhan et al., 2020). In addition,

Singapore liberalized immigration rules to attract immigrants from Hong Kong, China, Malaysia,

and other economies (Meyer & Xin, 2018). As a result, this attracted a large pool of immigrant

employees in the country, favoring economic growth and success in the country.

3.6 Effects of Expatriate Labor in Singapore

3.6.1 Positive Effects of Expatriate Labor in Singapore

Indisputably, multiple pieces of literature have interrogated the positive ramifications of

expatriate labor in a foreign country. As a result, this provides overwhelming and critical

evidence on the need to promote exported labor in the country. According to Yang et al. (2017),

the influx of the imported labor cushions the Singaporean economy against demand fluctuations.

In a nutshell, foreign workers' inflow allows an economy to take advantage of the economic

growth opportunities and improve the wage rate to reduce an economy from being less

competitive.

Uniquely, Singapore shifted its focus from FDI (foreign direct investment) to foreign

talents because of the vast opportunities that this economy saw (Meyer & Xin, 2018). However,
FOREIGN TALENTS 12

faced with the economic competition from other Asian economies, Singapore shifted its attention

towards attracting foreign talents to favor economic growth and advancement (Kwon, 2019). In

addition, the rising costs in labor costs in Singapore informed the decision to attract foreign

talents (Wright, 2017). Therefore, the cheap sources of labor were major aspects that drove the

foreign talent adoption in China.  

3.6.1.1 Solving the Labor Shortage and Providing Necessary Needed

Unquestionably, the lack of the necessary talents, including professionals, technicians,

executives, and managerial jobs, is the primary reason Singapore imports foreign labor (Kwon,

2019). Therefore, addressing the talent gap in the country is a bright side for attracting and hiring

non-locals. In the last three decades, Singapore has attracted an enormous talent pool to meet the

labor market demands (Wright, 2017). In addition, foreign workers bring new talents and ideas

to the labor market. Undeniably, foreign workers add diversity and come with unique talents to

improve the country’s competitiveness. Today, many developed countries, including Canada and

the USA, suffer from a shortage of science-based and technology-based talents (Kwon, 2019). In

response, they shop for talents elsewhere, including Vietnam, Poland, and Taiwan.

Moreover, new talents add cultural diversity, improving productivity. Singaporean

employers can encourage talent integration to optimize the advantages of foreign talents in the

country (Zhan et al., 2020). Foreign employees and the locals may share ideas and perspectives

on various aspects. In addition, the locals and foreigners may learn the culture from each other

(Wright, 2017). Therefore, this improves staff morale and promotes employee wellness.

3.6.1.2 Improving Job Satisfaction

The literature also recognizes job satisfaction as one of the positive ramifications of

attracting and hiring foreign workers. According to Mohammed et al. (2012), job satisfaction
FOREIGN TALENTS 13

declines when employers give foreign employees better treatment than locals. The literature

shows that some employees are reluctant to train in the advanced skills because the better

treatment given to the foreign professionals demotivates them from taking these jobs (Zhan &

Zhou, 2020). Therefore, this shows that the exceptional treatment given to foreign employees

discourages employees from training in professional jobs. 

3.6.1.3 Devotion and Better Job Performance 

The scholarly sources (Mohamed et al., 2012) reveal that expatriates devote themselves

towards jobs, improving productivity. According to Mohamed et al. (2012), the inner drive and

urge towards a job and earning are major reasons expatriates are more productive in their jobs

than local workers. In contrast, the local workers are the opposite of the foreign employees

concerning motivation and productivity (Gomes, 2019). Furthermore, unlike the foreign workers,

locals give a host of excuses to avoid additional work (Gomes, 2019). For example, they contend

work-life balance, the long working hours, and other luxuries to avoid work. Therefore, this

explains why many employers turn to foreign talents when hiring people in the workplace.

3.6.1.4. Prestige

Prestige is another legitimate reason and advantage of having foreign workers. Many

employers feel delighted having foreign employees working for them (Astorne‐Figari & Lee,

2019). Employers could improve their brands by investing in exceptional talents, including

multi-talented professionals (Kwon, 2019). Branding is a major factor that improves an

organization's marketability, explaining why investing the exceptional talent development.

Foreign workers also can market the brand in an international market (Gomes, 2019). For

example, expatriates may improve the brand identity in the home market. 
FOREIGN TALENTS 14

3.6.2 Negative Effects of Expatriate Labor in Singapore

3.6.2.1 Impact on the Employability in the Local Market 

The literature defines employability as the ability and attractiveness of a person to get a job

(Astorne‐Figari & Lee, 2019). Therefore, it means that a person seeking employment has the

requisite skills for gainful employment and performs specified duties. For example, a person

with mechanical engineering skills and experience is employable because they can meet the

work requirements in their field of work (Selmer, McNulty, Lauring, & Vance, 2018). According

to the literature, contextual factors, including knowledge, skills, and experiences, influence

employability (Constable, 2020). Therefore, this implies that human capital development is an

effective way to achieve employability.

Undoubtedly, attracting and hiring foreign talents instead of grooming the local talents

negatively affects the Singaporean economy (Lim & Leong, 2017). Although the

unemployability rate is low in Singapore, failure to groom the local talents, especially for expert

jobs, including executives, professionals, and technicians, is counterproductive in an economy.

According to existing literature sources, failure to groom local talents hinders self-sufficiency in

the labor market (Lim & Leong, 2017; Gomes, 2019; Constable, 2020). Each country should

have labor security to sustain its social-economic goals. Without a well-trained talent pool, a

country must depend on foreign talents to meet development demands. Therefore, this over-

dependence limits a country from creating well-paying jobs for its citizens. As a result, providing

quality jobs to the locals must be a top priority in economic policymaking. Because of the failure

to groom the local talents, Singapore’s ability to offer quality jobs to the locals is weak. 

Another direct effect of attracting expatriates without grooming the locals is increasing the

unemployment rate (Wan, 2020). Overwhelmingly, multiple studies agree that foreign talents in
FOREIGN TALENTS 15

a host country increase the competition for the scarce jobs in the labor market (Wan, 2020).

Worldwide, no economy is in real full employment status. Therefore, this implies economies are

yet to provide jobs to all eligible citizens, allowing people to sustain their livelihoods. A major

issue facing Singapore is underdeveloped local talent. If the country could invest in grooming the

locals for talents, the unemployment rate could reduce massively. In addition, grooming locals

for skills provided by foreigners may also transform Singapore into a top labor exporter to other

countries. 

3.6.2.2 Dilution of the Cultural Identity 

The influx of migrant workers in Singapore elicits enormous public criticism. Over the

years, Singaporeans have expressed dissatisfaction with the excessive immigration of foreign

workers in the country (Constable, 2020; Yang et al., 2017). Often, most criticism focus on

unemployment concerns. However, potential loss of cultural identity, overcrowding, and housing

crisis are also legitimate reasons attracting criticism on migrant workers' influx (Yang et al.,

2017). Therefore, dilution of cultural identity is a major concern that the Singapore government

should consider while encouraging immigrants. 

Regrettably, many Singaporeans argue that immigrants dilute their distinct cultural identity

and alter Singapore’s way of life (Aminnuddin, 2019). In addition, the locals are suspicious that

the migrants have questionable loyalty and indecent norms that compromise their values (Waxin

& Brewster, 2020). Many locals also allege that many immigrant workers are just using

Singapore to further their careers in other countries, including Germany, Australia, and Japan

(Waxin & Brewster, 2020). Therefore, it means they are in Singapore for the short term.
FOREIGN TALENTS 16

3.6.2.3 Using Education Resources Meant for the Locals

The massive scholarship programs targeting non-locals also elicit criticism and sharp

division among politicians and the locals (Ho & Tan, 2020). In the last three decades, Singapore

has offered hundreds of thousands of scholarships to foreigners (Waxin & Brewster, 2020;

Aminnuddin, 2019; Ho & Tan, 2020). According to skeptics, sponsorship programs use financial

resources and facilities that the locals could use (Ho & Tan, 2020). For example, they argue that

offering scholarships to foreigners increases school overcrowding by using space that the locals,

especially those in need, could use (Kong, 2018). Indeed, the government could prioritize the

locals in the scholarship programs. Instead of prioritizing foreigners, the locals argue that the

government could give scholarships to the talented employees in the workforce. 

3.6.2.4 Wage Depression 

Another unintended effect of expatriate labor in Singapore is that it depresses the wages

and salaries of the locals (Mohamed et al., 2012). Often, imported labor comes from the

developing and underdeveloped world. Most people seeking jobs in developed nations, including

Singapore, are desperate for jobs to sustain their livelihoods (Tian, Xu, Yu, & Zhu, 2018).

Therefore, such workers can take any salary offered to them their employees. Since most

employers are economic entities seeking to cut costs, they will hire expatriates to minimize labor

expenses (Ho & Tan, 2020). As a result, this depresses the wage rate and also kills jobs among

the locals.

The low earnings offered to expatriates also discourage locals from training for various

jobs, denying the country a sustainable talent pool to meet social-economic development goals

(Tian et al., 2018). In addition, low earnings offered to the locals that accept low-paying jobs
FOREIGN TALENTS 17

also erode their social-economic status and life quality (Tian et al., 2018). Therefore, this

counterproductive effect is a major factor attracting opposition to foreign talents.

Studies indicate that immigrant workers open an exploitation avenue for the locals

(Maharjan, Stoermer, & Froese, 2021). So naturally, immigrant workers are risk-takers and are

far willing than then locals to take jobs left out by the locals. In this aspect, the locals are

unprotected against unfair labor terms, including overworking and low wages, because

immigrant workers could accept the jobs that the locals could not accept (Maharjan et al., 2021).

Otherwise, the locals must find themselves in the working conditions experienced by the

foreigners. 

3.6.2.5 Housing Crisis and Overcrowding 

Negative effects of foreign talent attraction in Singapore are a major source of local

discomfort and discontent. Dissatisfaction with foreign talent and immigration policy manifests

itself in various ways (Shil, Shahriar, Sultana, Rahman, & Zayed, 2020). For example, the

government officials' loss of public support and divisions reflects the shortcomings that reflect

local discontent. In addition, foreign talent opponents allege that the expatriates increase

overcrowding, pushing then housing prices up (Shil et al., 2020). Since Singapore is a city-state,

the housing prices are undeniably high. Therefore, the influx of immigrants into the country

increases housing prices. As a result, this increases or creates a housing crisis in the country.

3.6.2.6 Discrimination 

Indisputably, discrimination is among the major threats to expatriate labor. While many

employers feel delighted when having a foreign workforce, the locals get minimal chances of

being hired (Yeo, Yam, & Giap, 2019). In Singapore, many locals criticize employers that hire

foreign talents for their failure to accord them equal opportunities as expatriate workers despite
FOREIGN TALENTS 18

having similar qualifications (Prematillake & Lim, 2018). Notably, this discrimination exposes

favoritism against locals over the immigrant workers. Therefore, this threatens the local

employment rate. 

Singapore must also understand that the growth in the local unemployment rate threatens

the national economy because of various underlying factors (Patuzzi, 2019). When the locals

lose jobs or do not have to sustain their livelihoods, their purchasing power declines, eroding

local demand (Yeo et al., 2019). As a result, this weakens the local demand in an economy. In

addition, foreign workers, especially those with permanent residency, rarely invest their salaries

and earnings in the host country (Chellaraj & Mattoo, 2019). Instead, they repatriate their

earnings and invest in their home countries. When the foreign workers invest in their home

country, the circular income flow moves from the host market. Therefore, the balance of

payment and economic growth in the host country weakens. 

Another issue concerning discrimination is that it deprives the locals and leads to their

discrimination in remuneration (Yeo et al., 2019). According to Mohamed et al. (2012), foreign

workers threaten employees on payment requirement, work quality, and numerous fringe

benefits, including relocation and risk incentives. In addition, the purchasing power among the

locals reduces (Chellaraj & Mattoo, 2019). Often, most people rely on their salaries and wages to

meet their livelihood. Unfortunately, lack of jobs undermines the locals’ purchasing parity,

sustaining demand in an economy. Therefore, this reflects the benefits and importance of

availing high-quality jobs to the locals.

3.7 Effective Strategies Singapore can Implement to Avert Overdependence on Foreign Labor

The literature provides credible and reliable insights on the impact of hiring expatriates

instead of grooming locals (Yeo et al., 2019). In response to the negative effects identified
FOREIGN TALENTS 19

above, the Singaporean government can introduce radical education reforms, including

competence-based education curriculum implementation and supporting STEM (science,

technology, mathematics, and engineering) careers (Bork-Hüffer, 2017). Today, many developed

nations are not overdependent on foreign experts, improving their competitive advantage in the

international market. Therefore, reforms in the education sector should also focus on equipping

the locals with the country's knowledge and skills elsewhere in Singapore. 

In addition to curriculum reforms, the country can develop knowledge interchange

programs, whereby the foreigners exchange knowledge, skills, and ideas with the locals

(Chellaraj & Mattoo, 2019). Strategically, the country could require foreigners to work alongside

the locals, allowing them to acquire the necessary skills and competencies to execute their duties.

Another strategy is to use experts to specifically train and groom the locals for the expert jobs

(Bork-Hüffer, 2017). Gradually, mass training of the locals for the expert jobs could see

Singapore reduce its overdependence on foreign labor.

However, the country must focus on quality education and training. Vocational training

institutions and universities must also ensure that their curriculum aligns with the labor market

requirements. Today, employers worldwide expect employees to have the practical skills needed

to start a job (Bork-Hüffer, 2017). Singapore can address this require employers and learning

institutions to closely collaborate to ensure that the students acquire hands-on skills needed in the

labor market. Therefore, this will limit Singapore from depending on the labor market. 

The government can also reduce foreign workers dependency by tightening the levies.

Most companies using foreign workers outsource labor from low-cost labor markets (Bork-

Hüffer, 2017). Singapore can reverse this by imposing hefty levies to increase the cost of

outsourcing labor. Malaysia, another East Asia country, successfully reduced overdependence on
FOREIGN TALENTS 20

foreign labor by imposing a stringent quota system on hiring employees (Mohamed et al., 2012).

In addition, the government could establish a law to ensure that employers avoid discriminating

against the locals when offering jobs (Chellaraj & Mattoo, 2019). Regular scrutiny of the

employers’ hiring practices is essential to prevent them from bypassing the law (Bork-Hüffer,

2017). Therefore, this will ensure that locals have equal opportunities as foreigners to secure any

job as foreigners.

Singapore must also control illegal immigrants. It can succeed in this by improvising and

implementing a database system to curb foreign employees. One way to curb this is by taking

biometric data of the immigrants entering a country (Chellaraj & Mattoo, 2019). Maintaining this

data for future reference is also necessary (Bork-Hüffer, 2017). Notably, this will keep an influx

of foreigners out the control. 

4. Conclusions

Hiring immigrant workers in Singapore has its bright sides and shortcomings. In

conclusion, immigrant workers without grooming local talents have dual effects and require the

government to address the dark sides. On the dark side, hiring foreign workers without local

talent development erodes employment opportunities because foreign take jobs meant for the

locals. In addition, the government should regulate foreign workers entering Singapore. Most

expatriates accept the jobs at far low wages and salaries, encouraging employers to hire

immigrant workers. Therefore, this reduces employment opportunities meant for the locals.

Foreign employees also lead to economic stagnation. Unlike the locals, foreign employees use

the salaries earned in the host country to invest in the home countries.  

Wage depression is another issue that comes with immigrant workers. Unlike the locals,

immigrants agree to work for any wage, weakening the growth in the wage rate in an economy.
FOREIGN TALENTS 21

Job discrimination is another concern for hiring foreign talents. Because foreign workers have

minimal labor demands, employers prefer foreigners in their hiring practices because the labor

market demands are fewer than those for the locals. Cultural identity dilution directly impacts the

immigrant workers because they come with new cultural norms. In addition, immigrants eat the

resources, including occupying classes meant for the locals.

On the bright side, foreign workers address the talent shortage by offering professionals

and technicians jobs that locals could not do. Employers also feel delighted to hire expatriates in

the market. Staff productivity and performance are also higher among expatriates than the locals

because immigrants tend to devote themselves to foreigners. Finally, higher job satisfaction is

higher among foreigners than the locals.

FOREIGN TALENTS 22

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