Progressive Wage Model?

Progressive age Facing W Challenges of Model Globalisation

Challenges

Manpower Productivity Shortage

Cost Competitiveness Manpower shortage in various sectors

Marine Engineering Aging workforce in some sectors Cleaning Construction Country Clubs

Attracting & retaining staff remains a key challenge Overall productivity growth in 2013 was -0.2%, an improvement from -1.4% in 2012

Percent Labour Productivity 15

0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 -5 Labour Productivity -10

Source: MTI, Economic Survey of Singapore 1st Quarter, 2014 Labour productivity performance is mixed across industries 10.0% Labour Productivity Growth in 2013 FinanceFinance & &Insurance, Industries above average 8.0% Insurance,7.5% 7.5% productivity to continue to 6.0% drive productivity growth WholesaleWholesales & Retail, 4.0% & Retail,2.6% 2.6%

Manufacturing,Manufacturing, 0.3% 0.3% 2.0%

InfoInfo & Comms, & Comms, 0.1% 0.1% 0.0%

-2.0% TptTpt && Storage, Storage, -1.5% -1.5% Industries below average Acc & FoodAcc Services, & Food Svcs, -1.8% -1.8% productivity to ramp up efforts -4.0% in driving productivity growth Construction,Construction, -2.9% -2.9% Source: MOM, Dept of Statistics. Note: Productivity based on prelim 0.0% growth More efforts needed to lift productivity Cost Competitiveness

• High business costs – rental, utilities & labour costs • Mergers and acquisitions among some electronics companies to streamline operations, increase efficiency and reduce costs • Relocation of companies to regional countries due to lower costs Relocation of Companies 84 companies over the past 10 years Most companies relocated were from electronics/electrical or petroleum/chemical industry

No. of companies relocated by industry from 2004 – 2013 40 36 35

20 19 16 13 15

0 Electronic and Electrical Petrolum and Chemical Machinery and Equipment / Others Products Prdoducts Medical and Precision / Fabricated Metal / Other Mfg • Count of unique companies Source: NTUC Malaysia, Indonesia and China are the most popular destinations for relocation

No of companies relocated by country from 2004 - 2013 45

40 39

20 18 17

10 9 6 5 4

0 Malaysia Indonesia China Others Thailand Vietnam • Count of unique companies Source: NTUC Real Wage Increases Challenges

Manpower Productivity Shortage Solution?

Cost Competitiveness PROGESSIVE WAGE MODEL

Win-Win Solution  Resolves companies’ manpower bottleneck, strengthen competitiveness and growth

 Improves workers’ job prospects and income What is Progressive Wage Model?

Productivity Principles of PWM

Fair to Steady progressive Process

Win-win Review for manage all 4 ment pillars

Y Internal shaped equity career Progressive Wage Model for ALL Workers in ALL Sectors

 4-in-1 model of Wages, Productivity, Skills & Career

 Better Productivity, Better Jobs, Better Pay

 From Low Wage Workers, Contract & Casual Workers to PMEs

What is Progressive Wage Model?

The key features of a PWM are: 1. Key objective to help workers earn better wages through skills upgrading and productivity improvements

2. The wage ladder comprises of a series of wage points, tailored for each job sector

3. It helps workers at all levels of the wage ladder to upgrade and progress to their respective next wage points What is Progressive Wage Model?

4. With a clear career progression pathway, create better opportunities and ensure that starting pay is kept relevant to the market

5. With productivity improvements, wage increases are sustainable and companies can better cope with manpower crunch Why should companies embark on PrivilegeProgressive for Wage Businesses Model?  Attract and retain manpower  Cope with manpower crunch  Make every worker a better worker

Wage Ladder

Skills Ladder Employee Business Attract Productivity Motivate Retain Satisfaction Performance & Engagement & Results Career Ladder Leverage on Government schemes and IGP to step up efforts on productivity Extension of Productivity & PIC till 2018 Wage Credit Innovation Credit Scheme (PIC) Bonus PIC+ for SMEs

3-Year Transition Tax Incentives ICT - Productivity & Support Package for Innovation Growth Programme 2013-2015

Corporate Progressive Special Income Tax Wage Incentive Employment Rebate & IGP Credit

Adoption of Machines, Up-Skilling & Multi-Skilling Automation & Technology

• Reduce reliance on manpower • Optimising manpower through • Make jobs easier, safer and multi-skilling and cross smarter (ESS). deployment Making Jobs More Attractive

• Clarity on the skills

• Enhanced career progression paths; breaking glass ceiling

• WSQ certification

• Place & Train programmes] Licensing for progressive wages in cleaning, security & landscape sectors

9 Jan 2014, BT Progressive Wage Model for Cleaners Key Thrusts

Range Commitment Up to drive PWM

Continuous & On-going Process Skills, Identify Competencies, Jobs & Productivity Career

Sectoral / Company Approach Sectoral Approach

National Tripartism • Pervasive & Scalable

• Clusters to identify Sectoral Tripartism key partners

Bipartism Sectoral Approach Example: Aerospace & Aviation Cluster

Government • CAAS • WDA

• Ground Handling • NTUC Companies Aerospace & • Airlines Aviation • CAG (employment hub) Cluster • Service providers • Association of Aerospace Industries • e2i (AAIS)

Workers Employers Range Up Salaries

Market Skills & Forces Productivity Job Worth Job

Range Up Salary

EXAMPLES Building & Facility Management Cluster Group 1: Group 2: Group 3: Office & Commercial F&B Establishment Conservancy e.g. TCs, Public Cleansing Cleaners e.g. Hawker Centre, e.g. Office, Schools, Hospitals and Foodcourts Truck Drivers (Class 4/5) Polyclinics Cleaners ≥ $1700

Supervisor Supervisor ≥ $1600 Supervisor / Class -3 ≥ $1600 Mechanical Drivers ≥ $1600

Multi-Skilled Cleaners / (i) ProductivityMulti-skilled -Cleanersbased /Factors Multi-skilled Cleaners / Machine Operator • Job Machinescope and Operator requirements Machine Operator / ≥ $1400 ≥ $1400 Refuse Collector • Skill set or qualification ≥ $1400 • Competency in operating machineries (i) Other Factors Outdoor Cleaners / In- • DishwasherJob environment / Refuse General Cleaners Collector patient Hospital Cleaners • Job location ≥ $1200 ≥ $1200 ≥ $1200 • Exposure to job hazard

Table-top Cleaners ≥ $1100 General / Out patient / Indoor Cleaners General Cleaners ≥ $1000 ≥ $1000 *Team Leader will receive additional wage allowance (starting from $100) PWS scale – Reference based on basic wage Suggested training guidelines for cleaners

Attained at least 2 WSQ Advanced Supervisors ≥ $1,600 Certificate in EC modules or Multi-skilled equivalent Cleaners / ≥ $1,400 Machine Operators Outdoor

≥ $1,200 Cleaners/ Dish Attained at least 2 WSQ Washers Certificate in EC* modules or equivalent General/ Indoor Cleaners ≥ $1,000 e.g. Offices, Schools, Hospitals and Polyclinics *EC: Environmental Cleaning Cleaners salary ≤ $1,000 *Team Leader will receive additional wage allowance (starting from $100). • Attained at least 2 WSQ Higher Certificate in EC modules or equivalent Healthcare Cluster HEALTHCARE CLUSTER PROGRESSIVE WAGE MODEL

Service Executive $2,500 $1,200 – Senior Patient PSA Senior HCA / $2,500 Service Enrolled Nurse Associate $2,000 (PSA) $1,100 – Healthcare $1,800 Assistant New Initiatives include : $1,500 (HCA) PSA - Job Redesign New Initiatives - New Career $1,000 – Senior include : Progression Health Pathway $1,500 HA - Greater Use of Attendant HCA Assistive Devices (HA) - Enhanced Career Workers Can Expect : $1,000 Progression 1) Skills Upgrading New Initiatives 2) Career Progression include : Workers Can Expect : 3) Better Pay - Greater Use of 1) Ease of Work Moving up HA Assistive Devices 2) Skills Upgrading *Current : $1,100 – $2,230 through 3) Career Progression 4) Better Pay Productivity, Workers Can Expect : Training, and 1) Ease of Work *Current : $930 – $1,670 Job Re-design 2) Skills Upgrading 3) Better Pay Initiatives *Current : $750 – $1,350 * The current salary ranges do not factor in the pay increase. Source: Healthcare Cluster Tripartite Workgroup OPEC Cluster $3,500 $4,500 PROGRESSIVE WAGE OPEC Cluster $2,500 • $1,900 $1,500 Basic Monthly - - - - -

$5,000 $7,000 $4,000 $3,000 $2,500 Salary

• Technician (Process) Structured in Nitec Nitec/Higher WSQ Training, & On Training

-the

2 years MODEL • Nitec /Higher experience Technician (Process) -job Senior Senior Diploma; Nitec -house

3 years Lead Process • Technician Technical Officer / Officer • framework • •

Enhanced careerpathways Strengthen trainingdevelopment and Attracting and upgradingSingapore Core w experience w Diploma

2 years To To • Assistant Engineer

benefit benefit w experience w Diploma Skills UpgradingSkills

1000 $ Fund 13 mil

5 years workers via: •

Engineer

Degree

Making PWM Pervasive

Aerospace Building & facility Electronics Healthcare & Aviation managementMore than

Finance Marine Education130 companiesHospitality are on Services Engineering some form of PWM Public OPEC Transport Infocomm Target: 600Sector companies by 2015

Thank !