Raising construction sector productivity - with an app

Raising construction sector productivity - with an app

The Singapore Contractors Association wants to change the way recruitment and manpower retention is carried out in the construction sector, starting with an efficient and transparent database system.

SGBudget 2014: Foreign construction 3

SINGAPORE: When construction worker Dharmaraj Thirugnanam found out that his employer would not be renewing his work permit when it expired, he registered on a database launched by the Singapore Contractors Association (SCAL). It cost the 27-year-old S$26 dollars to sign up, and another S$160 in fees when he was successfully matched to a new company in May, just before his time at his old employer was about to end.

Without the database, Mr Dharamaraj told Channel NewsAsia he would have had to return to India and apply to work in Singapore again through a recruitment agent. This would have set him back S$6,000.

"I learnt about the system through Facebook," said Mr Dharamaraj, adding that he knows of at least four other workers who have found jobs through the database.


Screengrab of the Foreign Construction Worker Directory System (FCWDS) app.

The database, known as the Foreign Construction Workers Directory System, matches construction workers on expiring work permits with suitable employers. Employers pay a S$2,000 annual subscription fee to access the directory.

"Recruitment agents' fees are one issue, plus the fact that they have to wait because there is processing time, and things like that. If it’s all done in Singapore, the process is pretty seamless,” said Mr Kenneth Loo, President of SCAL.

“It's really a pity if after a few years, because of whatever reasons - it could be that the job volume of that particular employer is low, and they have to let (workers) go - at the end of the day, we lose investments that we put into the individuals."


But the database, which was launched about a year ago and cost more than S$200,000 to develop, only has a user base of 6,174 workers. This is barely 2 per cent of the pool of more than 300,000 workers in Singapore. There are currently 65 employers on the database, with 111 successful matches to date.

Mr Loo’s firm, Straits Construction, accounts for nearly a quarter of the successful matches. He acknowledges there is scope to grow the numbers, and get more players, particularly smaller contractors on board.

"It's a change from the normal way of how recruitment is done (in the construction industry) - totally new. So I guess it'll take some time to build up the momentum,” said Mr Loo.

One in three foreign construction workers leave Singapore every two years when their work permits expire. SCAL estimates that it costs the industry “millions of dollars” to replace this group of workers, which are safety-trained and understand local requirements and standards.

And in line with a wider goal to promote the use of technology to boost productivity and growth, IDA offers eligible companies a subsidy of up to 70 per cent of database subscription fee for two years.

But Mr Loo notes that the slowdown in the property market could be a reason why the registration figures are low.

“The sector is currently going through a downturn. The new workers coming in are slowing down, so the figures are basically on the low side," he said.


Singapore has been going through restructuring for higher productivity for the last five years or so, and SCAL's electronic database is just one manifestation of those efforts.

In 2012, Deputy Prime Minister Tharman Shanmugaratnam noted that Singapore's level of productivity in construction is just over a third of the level seen in Japan, and that there was scope to use better technologies and project management processes to catch up.

But one analyst worries that the current slowdown in the construction sector may create a hitch in the push for productivity growth.

"We've been seeing lots of talk of higher tech construction methodologies, especially with the push by the BCA - we've see how the PPVC (Prefabricated Prefinished Volumetric Construction)-type of construction methods has allowed a lot of construction companies now to rely less on labour inputs and a lot more on technology,” said Mr Francis Tan, an economist at UOB.

“But past rounds of cooling measures have certainly reduced the potential demand for private residential buildings in Singapore, and in fact the slowdown in Singapore’s economy may also reduce the demand for commercial properties. Having said that, if you look at the fees that you have to undertake join the database versus the benefits, the benefits are a lot more. ”

Source: CNA/ll