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COVID-19: 5 Government Initiatives for SMEs Hiring Local Workers 2021 *Updated*
Article was most recently updated on 24 Sept 2021
We have seen how the Covid-19 pandemic has impacted businesses worldwide since the beginning of this year. The battle against Covid-19 is still ongoing, but global economies are not giving up and we see businesses adapting to the new normal as days go by.
With the 5th round of support measures announced by Deputy Prime Minister (DPM) Heng Swee Keat in his ministerial statement on 17th August 2020, Singapore Government has maintained its stance in supporting businesses and retaining local employees amid this difficult time. In addition, there have been more initiatives to promote hiring of local workers.
The Jobs Support Scheme (JSS) is definitely one of the core supports that businesses rely on since business operations were affected by the Circuit Breaker in April, and continue to be struggling when the Singapore economy gradually reopens. DPM Heng has also announced the extension of JSS to March 2021, with the main focus on industries that were and still are severely affected.
It is nevertheless inevitable that not all businesses are able to retain their full workforce. Unemployment rate has risen to an all time high since the first quarter this year from the effect of Covid-19. Hence, other than encouraging businesses to retain, reskill and upskill their employees, the government has taken a different approach to encourage businesses in hiring new local workers.
Here are 5 government initiatives that support businesses in their hiring practices:
- P-Max Programme (The P-MAX Scheme has expired in Dec 2021, but with the introduction of the Career Conversion Programme (CCP) SMEs can now get up to 90% Salary Support for 3 months for their newly hired. Read more here: Career Conversion Programme (CCP)
P-Max is a Place-and-Train Programme by Workforce Singapore (WSG) to help SMEs to better recruit, train, manage and retain their newly-hired local Professionals, Managers, Executives and Technicians (PMETs).
If your company has recently (within the last 3 months) hired a new Singaporean or Permanent Resident (PR) employee who falls under the PMET category, sign up for the P-Max Programme now. PMET must be offered a monthly salary of at least S$2,500.
You will be eligible to claim a one-time Assistance Grant of S$5,000 if your company successfully retains the PMET for at least 6 months after attending the P-Max workshop. If your newly-hired PMET is a Singaporean aged 50 years and above, you will be eligible for a S$10,000 assistance grant.
The P-Max workshop consists of a 2-day training curriculum, whereby a Supervisor will attend the first day together with the PMET, and the PMET is required to attend both days. Workshops are currently conducted virtually, with available dates on 7th & 8th November 2021 (next available workshop). The workshop is 90% subsidized by WSG, and course fees vary depending on the administrator of the programme. (After subsidy, it is approximately S$188, payable by SMEs. For PMETs aged 50 years and above, supervisors will be required to attend an additional 1-day Age Management Workshop at S$50.)
Take advantage of the lull period now to send your supervisor and PMET for training and claim up to S$10,000 Assistance Grant.
Click here to register now!
- Senior Worker Early Adopter Grant & Part Time Re-employment Grant
As part of an effort to promote employment and retention for senior Singaporean workers, a S$1.3 billion Senior Worker Support Package was announced in this year’s Budget 2020. Out of which, S$100 million has been set aside for the Senior Worker Early Adopter Grant and Part Time Re-employment Grant.
The current statutory retirement age is 62 while re-employment age is 67. The first scheduled increase will take effect from 1st July 2022, when the respective ages will rise to 63 and 68, and gradually increase to 65 and 70 respectively by 2030.
By implementing a higher internal retirement age and re-employment age ahead of the national schedule, and employers committing to provide part-time re-employment opportunities to senior workers, a company can claim up to S$375,000 from the above two grants:
Companies that raise the ages by 3 or more years above the prevailing statutory ages will receive S$5,000 per senior worker aged 60 and older from the Senior Worker Early Adopter Grant, capped at 50 workers. On top of this, companies that commit to providing part time re-employment opportunities to senior workers who have requested for it can also receive S$2,500 per senior worker.
- Career Trial Programme
The Career Trial Programme, previously known as the Work Trial Scheme, provides job seekers with training allowance for up to three months when they take up one of the applicable jobs on a trial basis.
This will help to address the concern that most employers have regarding whether the applicants are the ‘right fit’ for the company. As much as possible, companies will want to reduce any additional costs incurred if they are unsure of the employee's ability, hence the Career Trial Programme will help job seekers and employers to get to know each other better before signing on the dotted line.
The Career Trial Programme targets full time jobs of paying at least S$1,500/month and part time jobs paying at least S$750/month, with salary support funding up to 30% for up to 6 months.
For companies that are keen to participate in the Career Trial Programme, please refer to www.wsg.gov.sg/careertrial_employers for application and further details.
- SGUnited Mid-Career Pathways Programme
The SGUnited Mid-Career Pathways Programme aims to provide attachments and full-time training courses for mid-career job seekers, at the same time to widen their professional networks and gain new skills for the future.
Mid-career job seekers have the opportunity to apply for industry-relevant attachment programmes, ranging from four to nine months, to gain meaningful and relevant experience while receiving a training allowance. This will also help them to develop new skills while boosting their employability for more permanent jobs in the future.
Under this scheme, 80% of the training allowance will be funded by the Government, while the host organization funds the remaining 20% for the 4 - 9 months durations.
Organisations interested to be host organisations to take on mid-career individuals on attachments can fill up this Interest Form. Host organizations are required to provide clear attachment descriptions and development plans that would provide mid-career individuals with meaningful developmental opportunities during the attachment period, subject to approval by the appointed programme manager.
The appointed Programme Manager, Singapore Business Federation (SBF), will get in touch with organisations on the application process thereafter.
- Job Growth Incentive (Extended till Mar 2022)
The Job Growth Incentive (JGI) is the latest scheme announced, and it aims to further promote local hires over the next six months, from September 2020 to February 2021. More than 50,000 local job seekers were hired in the first month of the implementation of the Jobs Growth Incentive (JGI). In the month of September 2020 alone, around 14,000 eligible companies collectively hired over 50,000 local job seekers and 50% of these new hires were mature local aged 40 and above.
JGI alleviates some costs by providing salary support funding for SMEs that are thinking of hiring as the economy gradually picks up. SMEs that increase their local workforce between the stated timeline will receive one year of salary support from the Government for each new local hire. There must be an increase in overall local workforce size, and increase in local workforce size earning S$1,400 or more per month, compared to August 2020 local workforce.
The government will co-fund up to 50% of the first S$5,000 of gross monthly wages for all new local hires aged 40 and above and for local workers that is 1) a Person with disabilities or 2) an ex-offender. For those below age 40, there will be a co-fund of 25% of the first S$5,000 of gross monthly wages.
The first JGI payout will commence in March 2021, computed on a monthly basis based on employer’s mandatory CPF contributions. Eligible companies will be automatically included, and notified by IRAS by post. SMEs will also receive JGI payout on top of the existing JSS payout.
Employers can use the JGI calculator to calculate their baseline and check their eligibility for JGI.
However, please note that the JGI payout will be adjusted downwards if any existing local employee leaves after August 2020.
Please refer to the payout schedule below for JGI:
Lastly, please note that any abuse of the JGI scheme will result in companies being denied their JGI payouts, as well as face up to 10 years of imprisonment and fine.
Companies registered from Feb 2021 or being dormant for the past 3-6 months will not be eligible
From October 2021, eligible employers will receive wage support of 15% of the first $5,000 for up to six months, up to $4,500 per hire aged below 40. For mature hires aged 40 and above, persons with disabilities and ex-offenders, the wage support will go up to 50% of the first $6,000 for up to 12 months, up to $36,000 per hire.