Unemployment Insurance in Singapore: Yay or Nay?

unemployment insurance

The topic of having an unemployment insurance in Singapore is not new. In fact, Labour MP Patrick Tay has broached the subject in Parliament and called for unemployment support for PMEs who are retrenched and transiting into their new jobs since 2016.

NTUC and SNEF recently put forth the recommendation to introduce a national unemployment support for those who are involuntarily unemployed.

In simple English, it means that NTUC would like the Government to implement an unemployment scheme for those who are retrenched and actively trying to find a new job.

Why unemployment insurance is needed

In a conducted by Milieu, it was found that of PMEs (especially those above the age of 40), face a lot of anxiety about retrenchment and unemployment. This is understandable, given that they belong to the age group that are breadwinners supporting both aged parents and young children.

They may also take longer to find another job if they do not have the relevant skillsets and are deemed less competitive than younger hires. Oftentimes, this may also mean that they suffer paycuts when they land their next job too.

Hence, having unemployment can help tide them through this tricky transition period. This reduces the amount of stress that they undergo and the chance that they would pick an unsuitable job.

Unemployment helps in the job search journey

Having unemployment also assists Singaporeans in their job search journey. When they have some monetary support, they can attend upskilling courses. This boosts their chances to get hired for an equally attractive job (if not better). A better job match gives a favourable long-term outcome for the PMET, helping them stay employed for a longer period.

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Balancing the to prevent becoming a welfare state

Nevertheless, we should not forget that there’s a need to balance the rendered.

MP Tay understands this as he explained:

“The key is, we don’t want this unemployment to be providing a disincentive to work, meaning this support is to help you to alleviate some of the challenges in the period that you’re looking for a job.”

These benefits should be rolled out together with “active labour market policies”, he said. For example, job seekers may need to participate in programmes organised by Workforce Singapore and the Employment and Employability Institute.

“So being on our programmes, actively looking for job openings, attending some of the employability boot camps that we organise for these unemployed or retrenched workers, and at the same time, attending interviews when given opportunities arranged by these two placement agencies, as well as attending some of the job fairs.”

This is to ensure that unemployed Singaporeans will continue to actively find a job. We do not want Singapore to become a welfare state as that would burden the state and hence, taxpayers. That being said, Covid-19 has also shown us how volatile and fickle the job market can be. Hence, there is a need to also Singaporeans against sudden job losses that are out of our control.

Kudos to MP Patrick Tay for speaking up for Singaporeans on this topic multiple times, since as early as 2016! 😊

Singapore’s unemployment rates improve in Q2 2021

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