Disclaimer: Opinions expressed below belong solely to the author.
The number of Singaporeans in senior roles in finance has nearly doubled in the past six years to over 3,000 people — that was the answer Senior Minister Tharman Shanmugaratnam provided last week to MP Leong Mun Wai who asked about “the current percentage of Employment Pass holders, permanent residents and Singaporeans holding senior roles in the finance sector”.
You may have seen it in the news last week, as it was quite widely circulated. However, I believe there was one missing element in these reports — and that is how the sector grows as a whole, and the role non-Singaporeans play in it for the benefit of the locals.
This is a highly controversial topic for some, with many believing that foreigners are enjoying outsized benefits when they move to Singapore, taking up jobs that qualified locals could perform, hence relegating Singapore citizens to lower positions and pay.
Setting aside the fact that Singapore has historically been almost entirely populated by immigrants (who simply happened to have arrived in different periods of time), I think it’s important to underscore that foreign workforce — on all levels — is essential to the creation of jobs for current citizens.
Growing the pie
Let’s take another look at SM Tharman’s parliamentary reply, which was quite brief, but packed with information:
Answer by Mr Tharman Shanmugaratnam, Senior Minister and Minister in charge of the Monetary Authority of Singapore (MAS):1 Senior financial professionals with more than 15 years of related work experience and undertake executive decisions in the company.
1. As at end-2021, about 71 per cent of the financial sector workforce were Singapore Citizens, 14 per cent were Permanent Residents (PRs), and 15 per cent were work pass holders. For senior roles1, based on MAS’ survey results for 2020, about 46 per cent were Singapore Citizens, 21 per cent PRs and 33 per cent work pass holders. These proportions have remained stable over the years, with a gradual increase in the proportion of Singapore Citizens holding senior roles in the finance sector.
2. In absolute terms, more than 3,000 Singapore Citizens now hold senior positions in the financial sector, an increase of more than 80 per cent compared to 2016.
What does it tell us?
- Over 70 per cent of people employed in finance are citizens.
- 46 per cent of those in senior roles are citizens — so, fewer than foreigners, however…
- …in absolute terms, the number of Singaporeans in senior roles increased by over 80 per cent, to more than 3,000 people since 2016.
Finally, as these proportions are broadly the same over time, it means that the entire sector is growing. In essence, the pie is getting bigger — and everybody benefits from it.
If there are over 3,000 Singaporeans in senior roles in finance today, then in 2016, it was only around 1,600 to 1,700. With an increase of 80 per cent or more, that’s an additional 1,200 to 1,300+ positions for decision-making executives with 15+ years of experience.
At this point, it becomes a “glass is half full versus glass is half empty” debate as complainers will ask why only 46 per cent of these roles are filled by citizens, instead of looking at the fact that there are nearly twice as many of them in these positions today.
What it also shows us, however, is that foreign immigration is necessary for the creation of these and other jobs for Singaporeans.
According to the Association for Financial Professionals, 132 commercial banks — four local and 128 foreign — had presence in Singapore as of 2019.
That is in addition to dozens of other financial institutions, of which, only a handful are domestic. The vast majority of Singapore’s financial sector is under foreign ownership and control — and most of it runs international operations out of the city-state (rather than serving local clients), necessitating employment of foreign staff.
The fact that nearly half of all senior roles in these overwhelmingly foreign institutions are filled by Singaporeans should be a reason to celebrate, not complain.
It also shows that the more foreigners come to Singapore, the more jobs they create for locals — including those who are climbing the career ladder, or returning from abroad with relevant global experience to take senior positions.
Singapore itself is too small to be able to fill all vacancies (eg. in tech), and if there are no people to do the jobs needed on all levels in the company, there are no people to manage, and there will then be no need for managers and high-ranking executives — most of whom would be forced to move to wherever they can exercise responsibilities vested in them.
As long as the city-state allows these — and other — companies to seek out the best talent abroad, they will reciprocate by creating more jobs for locals too. Unlike what some like to claim, many of them are in positions of the highest responsibility and pay.
Featured Image Credit: MCI and Depositphotos