Budget 2021 Highlights | 4 Must-Knows for Job Seekers
Updated: 10 hours ago
In his Emerging Stronger Together themed Budget 2021 address, Deputy Prime Minister Heng Swee Keat announced a slew of enhanced job support measures to continue to strengthen the workforce in the wake of the global pandemic. As the economy is slowly but surely recovering from the recession, the focus of the 2021 budget seems largely centered on the sustainable creation of jobs. In other words, we’re paving the way towards economic recovery rather than rescue.
What does this mean for you? Here’s what you can look out for if you’re on the hunt for a job during this period.
It has been well over a year since nations worldwide were crippled by the global pandemic. Since then, developed and developing countries alike have been hit with subsequent waves of infections. While Singapore has been fortunate enough to contain the spread for now, we can see considerable damage done across most sectors of the economy, particularly aviation, tourism and entertainment (we’ve just bid a temporary farewell to the most beloved Teo Heng KTV franchise... )
Last year, our country experienced its worst recession since independence. Because of the pandemic-induced recession, the government has tapped into the country’s national reserves for the first time since the 2008 global financial crisis. Not surprisingly, the most recent Budget 2021 address - themed Emerging Stronger Together - extended and enhanced the Job Growth Incentive and SGUnited Jobs and Skills Package to continue the support for the lacklustre job market.
Before we cover the 4 job support schemes that you should be well acquainted with, let’s dive a little deeper into what is a Budget, its process and the significance of this year’s Budget in response to COVID-19.
Explainer: What’s the Budget?
The Budget includes the revised revenue and expenditure projections for the current and following financial year. For the Budget every year, the government prioritises different short-term and long-term measures to support and boost the economy. In Singapore, each financial year (FY) begins on 1 April of the calendar year and ends on 31 March of the following calendar year.
The Budget process kicks off in November, where the Ministry of Finance initiates rounds of discussions with other ministries and agencies to identify national priorities. The findings and proposed plans are subsequently opened to public consultation gather a range of feedback and perspectives from different stakeholders.
This could look something like businesses, unions and individual households (stakeholders) putting forth their ideas over dialogue sessions, listening points and online channels (feedback avenues). The suggestions gathered contribute to the final design of the final Budget line-up, which has to go through approval by the Cabinet before presented to the Parliament by the Finance Minister.
Following this, the Budget Statement is debated in Parliament and the Finance Minister then delivers a Round-Up Speech that clarifies the queries raised and summarises the main gists of the Budget. Parliament then sits as the Committee of Supply to examine each ministry’s plans, before debating and voting on the supply bill. The Supply Bill is passed with the President’s assent, enacted as the Supply Act which controls the Government’s spending for the financial year.
COVID-19 response and the Budget(s) in 2020 and 2021.
2020 was a year of many firsts.
In the wake of COVID-19 disrupting global supply chains, the government rolled out five fiscal packages spread across four budgets (Fortitude Budget, Resilience Budget, Solidarity Budget, Unity Budget) to cushion the economic blow. The total projected expenditure for the expansionary Budget was estimated at S$193 billion across the four budgets, with S$93 billion allocated specifically for the pandemic response (that’s 20% of our GDP!). Of the $93 billion, $52 billion was drawn from national reserves, the first time since the 2008 global financial crisis. Also for the first time since independence, we ended the 2020 Financial Year (FY2020) with a record-high budget deficit of S$64.9 billion (13.9% of GDP). This Business Times article summarises succinctly how the government’s support measures went into helping the hardest-hit sectors, smaller firms and lower-income households.
Come 2021, the ‘Emerging Stronger Together’ themed budget has a sharper focus on helping sectors that are most affected by the economic downturn. While continued efforts to support businesses and workers through the extended Jobs Growth Incentive (JGI) tapers off for FY2021, there is a targeted focus towards supporting sectors that are still struggling to recover amid the pandemic. As expected, moving away from a broad-based rescue strategy we’ve seen in 2020 pushes the economy towards recovery through the creation of sustainable and in-demand jobs.
Furthermore, the 2021 Budget also touches on long-term macro goals that focus on cementing Singapore’s position as a global business hub and a frontrunner in technology and innovation. Among other COVID-19 relief measures, we also see a portion pumped into helping businesses innovate, build capabilities and take up digital transformation to be future-ready and stay competitive.
Jobseekers Guide for Budget 2021:
The 4 Schemes to Look Out for
1. COVID-19 Recovery Grant
The COVID-19 Recovery Grant (CRG) aims to help lower- to middle-income workers and self-employed workers who have been affected by the pandemic, on top of existing COVID-19 relief measures.
The grant provides temporary financial support to Singapore Citizens and Permanent Resident workers who have been retrenched, placed on involuntary no-pay leave or have experienced salary loss of at least 50% for at least three consecutive months. CRG aims to give an additional layer of support to help these individuals as they continue to search for new employment or upskilling opportunities to improve their capabilities.
Up to $700 per month for 3 months for employees who have i) lost their jobs or ii) placed on involuntary no-pay leave for at least 3 consecutive months
Up to $500 per month for 3 months for employees who are i) facing average income loss of at least 50% for at least 3 consecutive months
Interested individuals can apply for CRG online here from 9am to 10pm daily from 18 January to 31 December 2021.
2. Extended SGUnited Jobs and Skills Package
Introduced in May 2020, SGUnited Jobs and Skills Package is a suite of efforts aimed to help 100,000 job seekers affected by the economic downturn expand their capabilities and acquire job-related skills through employment, traineeships and skills training opportunities. At the end of December 2020, nearly 76,000 individuals benefited from the package.
For clarity, the SGUnited Jobs and Skills Package comprises of the following initiatives:
SGUnited Jobs: Placement of jobseekers into short-term roles that handle immediate COVID-19 related operations and long-term roles in the public and private sector.
SGUnited Traineeships: Supporting recent and new graduates of Institutes of Higher Learning and Institute of Technical Education with opportunities to build their capabilities and enhance their employability as the economy recovers from COVID-19.
SGUnited Mid-Career Pathways: Similar to the concept of SGUnited Traineeships, this programme primarily focuses on the mid-career group through traineeships and training opportunities. Those eligible have the option of either company attachments or training.
SGUnited Skills: A full-time training programme that spans from six to 12 months, offering a range of certifiable training courses in-demand skills in emerging sectors that are developed and delivered by Continued Education and Training (CET) and Institutes of Higher Learning (IHL).
In Budget 2021, the package will get an additional S$5.4 billion to support the hiring of 200,000 locals this year and provide up to 35,000 traineeships and training opportunities. The bulk of which - at S$5.2 billion - will go into extending the Jobs Growth Incentive (JGI) for seven months till September 2021.
JGI is a 12-month salary support scheme starting from September 2020 that aimed to encourage employers to expand local hiring needs. For non-mature local hires (new employees under 40 years old), JGI will provide up to 12 months of salary support while for mature hires, persons with disability or ex-offenders hired by employers will receive up to 18 months of salary support.
The Budget 2021 also announced the extension of the SGUnited Skills programme, SGUnited Traineeships and Mid-Career Pathways till March 2022. These are the following changes made to the programmes, which will take effect from 1 April 2021 onwards:
SGUnited Skills: More training courses and options are made available in high-growth sectors that have good hiring potential. The course will be condensed and structured in modules so that jobseekers can have the flexibility to exit and take up employment should they be presented with the opportunity to do so.
SGUnited Traineeships: The Traineeships programme will be extended to include the Class of 2021. For ITE graduates, the monthly stipend will be increased from $1,500 to $1,800. For Diploma graduates, the monthly stipend will increase from $1,800 to $2,100. The stipend for university graduates remains unchanged.
SGUnited Mid-Career Pathways
- Company Attachment: The attachment allowance will be increased from $3,000 to $3,800 monthly. For host organisations with mid-career individuals aged 40 and above, the government will increase co-funding training allowance by 10%, from 80% to 90%.
- Company Training: Individuals will be given a monthly training allowance of $1,500 during their duration in the course. The course is also shortened to a maximum duration of 6 months.
3. 500 Fellowship Programmes for Innovation and Enterprise
Under the new Innovation and Enterprise Fellowship Programme (IFP), National Research Foundation will be supporting about 500 fellowships to grow deeptech talent in cybersecurity, artificial intelligence and health sectors over the next five years. This means that the government will be working closely with partners, accelerators, venture capital firms and deep-tech startups to groom future leaders capable of fostering an innovation-driven startup ecosystem.
4. Support for Hardest-hit Sectors (Tiers 1 and 2)
The Job Support Scheme (JSS) was introduced in the Unity Budget in February 2020. Under the scheme, all active eligible employers are able to get wage support to retain their local employees who are Singapore Citizens and Permanent Residents. The government co-funds between 25% to 75% of the first S$4,600 gross monthly salary till March 2021 under JSS.
In the most recent 2021 budget announcement, S$700 million has been committed to the extension of the scheme - a fraction of its previous allocation in 2020 at S$25 billion, which has supported over 150,000 employers for up to 17 months. JSS was extended in Budget 2021 by six months for firms in Tier 1 sectors (Aviation, Aerospace and Tourism sectors). Wage support is adjusted to cover 30% from April to June 2021, reducing to 10% from July through September 2021 for these sectors. Meanwhile, JSS was extended for three months for firms in Tier 2 sectors (Retail, Arts and Culture, Food Services and Built Environment). Wage support will be at 10% from April to June 2021 for these sectors. For the remaining sectors, wage support will end in March 2021.
These two sectors are set to benefit from additional COVID-19 relief support:
S$870 million will be allocated to the aviation sector to preserve core capabilities and extend cost relief.
Arts and Culture Resilience Package and Sports Resilience Package: S$45 million allocated to Resilience packages support businesses and self-employed persons in these sectors.
If you would like to find out the rest of the Budget 2021 highlights, Deloitte Singapore consolidated an amazing Budget snapshot over here.
Upskilling no longer a “good-to-have”, but a necessity
While we will not see a “fiscal bazooka” like the one we did in 2020, the overall Budget position in 2021 remains expansionary to help the nation tide through the COVID-19 crisis. That said, we can expect a budget deficit of S$11 billion (2.2% GDP) in FY2021.
The pandemic has presented a series of hurdles that have rendered prevailing business models and ways of working obsolete. Thousands of people have lost their jobs, if not put on furloughs. This highlights how crucial it is to stay relevant as we navigate the post-pandemic world. It’s a recognition long overdue, but many are only just starting to see first-hand the importance of skilling, reskilling and upskilling for any company’s success and longevity in the face of disruption.
As we move from crisis rescue to recovery and beyond, we are forced to reevaluate what it truly means to thrive. Beyond staying employable through the training of transferable skillsets (and especially soft skills), there is a deeper facet that contributes to any individual’s unyielding agility. We’ve put forth our argument here in our pragmatic defence of career fulfillment: that the motivation to improve oneself is intrinsic, and intrinsic motivations are ultimately driven by meaning.
And that’s the not-so-secret recipe for human and career resilience in this new world.
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