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Companies are trying to hold on to their foreign workforce despite the cost pressures of the circuit breaker, but if the momentum comes to an end, this group could be the first to leave, employers and human resources experts say.
Such workers are a mainstay of the economy, with about 1.15 million employees here, including those with employment passes, S passes, and work permits. The number excludes foreign domestic workers.
There have been reports of cost cuts and reductions amid the uncertainty of the pandemic, and the first of those cuts would typically land in the foreign workforce, said David Leong, managing director of human resources firm PeopleWorldwide Consulting .
While the government has implemented rebates and tax breaks for foreign workers to help companies retain these workers, the key Employment Support Scheme (JSS) for wage subsidies covers only local employees.
Lee Quane, regional director for Asia at human resources consultancy ECA International, said foreigners employed in the tourism, food and beverage and transportation industries will be at high risk of contraction.
He noted that these are among the sectors that not only employ a relatively large number of foreigners, but are also the most affected by the coronavirus pandemic.
He added that these workers have roles where it is difficult to recruit enough locals, so the risk depends on how quickly recovery is expected to come for their sector.
Some employers are trying to retain their foreign workforce, although many are already struggling to keep their businesses afloat and wondering how long they can resist.
Abdul Sukkoor, who employs 28 people from Malaysia and India on work permits or S passes, said billing has been cut in half at its five Prata branches.
Paying its 50 employees their full wages has cut 30% of the restaurant’s total profit margins. “We just need to survive for the next month and hopefully things will get better in June,” he said, adding that he needs to retain staff to be ready for when business returns to normal.
Similarly, the head of security agency Gary Haris, who employs about 200 Malays, has had to use the company’s savings to pay officers and house those unable to return home due to the order from Malaysian motion control.
Other companies have had to cut their workforce.
Edwin Sudhakar, head of human resources for Asia Pacific, Australia and New Zealand at IT services firm Virtusa, said that when the projects end, some of the foreign staff involved move to Virtusa units in their home countries if there are opportunities. It will be difficult to find opportunities for the rest as business is slow, he said.
A handful have also asked about moving home, as they were eager to be with their families during the pandemic.
The total number of foreigners employed here, excluding foreign domestic workers, decreased by 22,200 between December and last March, the Ministry of Human Resources said.
One reason is that travel restrictions to avoid imported cases of the virus have prevented some workers from returning, Human Resources Minister Josephine Teo said last month.
Such restrictions around the world have left some companies struggling to replace the temporary labor deficit, as workers choose to remain in their home countries.
Security firm Aetos has had to redistribute and take advantage of its officer pool to replace Malaysian officers who are still in Malaysia.
Quane said JSS will help employers manage overall labor costs, although it does not directly reduce the expense of employing individual foreigners.
But some foreigners already face difficulties holding on or securing jobs during this time.
A 29-year-old Filipino who gave his name only when John canceled his S Pass on April 15, two days after his employer, a legal solutions firm, told staff that he had requested the liquidation.
While it’s unclear whether the job loss was directly due to the Covid-19 situation, this meant that John only had the lapse of his 30-day short-term visit pass to find another job.
“We were ready for cost cutting, but this was a shock. Even if my salary had been reduced by $ 300, at least I would still have a job,” said John.
“You can’t find a job in the middle of the circuit breaker. I don’t think companies will accept foreigners when they cut costs, especially when they have to pay our salary and levy (after the exemption and markdowns end).”
He plans to return to the Philippines this week after reducing his savings to settle his taxes and bills, as the job search and requests to extend his pass have been unsuccessful.
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