SINGAPORE: Some businesses in Singapore are finding it tough to cope with digital technologies that have transformed traditional business models, Members of Parliament (MP) said during the Budget debate on Tuesday (Feb 27).
“Many businesses are struggling to keep up with these transformative changes,” Ang Mo Kio GRC MP Darryl David said, noting that digital technologies have changed the way business decisions are made and how goods and services are delivered and consumed.
“It is crucial that our firms, especially our SMEs (small- and medium-sized enterprises), develop digital capabilities and competencies to compete in this digital era.”
Likewise, West Coast GRC MP Foo Mee Har said firms, facing a severe tech talent crunch, have complained that they are unable to embrace the digital push and adopt new technologies.
Labour MP Desmond Choo, citing a Singapore Business Federation survey, said one in four companies are “slow to transform their businesses”, with some of them failing to digitise any part of their businesses.
“Clearly, these businesses lack transformation capacity,” he added. “For example, many training programs require time away from work. But in a tight labour market, workers are prioritised for operational purposes.”
Nevertheless, Nominated MP Thomas Chua urged businesses to be more proactive “to push the pace of transformation and innovation”.
“Transformation and upgrading of enterprises is like stretching the body, where periodic pains are unavoidable,” he added.
MORE HELP FOR BUSINESSES
With that, some MPs called for more help for businesses struggling with the digital shift.
In his Budget speech earlier this month, Finance Minister Heng Swee Keat unveiled the Productivity Solutions Grant, a streamlined grant to help firms get easier access to money for tech solutions.
In addition, 650 SMEs have benefitted from the SMEs Go Digital Programme since its launch last year, he added.
While the programme has been a “timely shot in the arm”, Mr David hoped it can be expanded to support more companies.
“This is especially important for our SMEs that might not have same corporate resources and knowledge as MNCs (multinational corporations) to initiate large-scale upgrading and transformation,” he said.
Ms Foo suggested the Government should consider adjustments to the mix of foreign manpower to support growth in areas of future economy, such as expertise in data analytics, artificial intelligence and cybersecurity.
“In order to capitalise on growth momentum, foreign manpower policies may need to evolve to include skill-based factors to prioritise types of foreign skills and expertise, like those adopted in other countries,” she said.
Ms Foo also stated that Government agencies should work together to update regulations, making it easier for businesses to “cope with the rapid pace of innovation and increasing competition, even from within the ASEAN region”.
“I spoke in the last Budget about the need for the Government to create enabling environments, within which companies can become nimbler and more innovative,” she added.
To that end, Workers’ Party Non-Constituency MP Leon Perera said Singapore can stay relevant in the unfolding disruption in Asia by being a research and development hub and a manufacturing base for high-tech exports.
But closer to home, the impact of technology on the labour market will be “broader, deeper and more rapid than previous technological advances”, Sembawang GRC MP Ong Teng Koon said.
“What will result is not just traditional structural or cyclical unemployment,” he added. “We will experience a permanent secular shift in the economy, which will change what jobs are available and what skills are in demand.”
According to research by The Boston Consulting Group, Mr Ong pointed out, jobs like machine operator and production planner would be obsolete, while new roles like data scientist and robot coordinator would be created.
Despite that, Mr Ong said the Government has had the foresight to implement SkillsFuture with an emphasis on skills upgrading.
Mr Heng said in his Budget speech that the Government will set aside an additional S$145 million for the Tech Skills Accelerator (TeSA), a SkillsFuture tripartite initiative to train and build the Infocomm Technology workforce.
TeSA will be expanded to sectors like manufacturing and professional services, where “digital technologies are increasingly important”, Mr Heng added.
Still, employers tend to fear losing the benefits of investing in training when employees leave, Labour MP Patrick Tay said, describing the concern as valid but myopic.
“Instead of viewing training as a short term cost, employee development should be regarded as a long term investment that allows staff to add value to their roles and take up expanded job scopes,” he added.