During a diplomatic visit to Jakarta, Foreign Minister Vivian Balakrishnan is thinking of launching a direct hiring scheme for fresh graduates from Indonesia universities. Under his proposal to his Indonesia counterpart, Singapore employers will have access to cheap fresh graduates from Indonesia:

“Indonesia offers new opportunities for Singapore companies in the infrastructure development and services sectors, as well as the new digital economy…

We are thinking of launching a scheme in which Singapore companies which are looking for talent will be able to recruit talent here, deploy them here and provide services for the rest of the world.”

Currently, the average Singapore fresh graduate draws S$3,100 in monthly salary, while the average Indonesian fresh graduate draws about 6.5 million rupiah (S$675) monthly – amongst the lowest in South East Asia next to Philippines. If Foreign Minister Vivian Balakrishnan proceeds with his proposal, the average salaries of Singapore workers will be impacted negatively although local employers will benefit from the substantial cost savings.

Singapore’s labour productivity has been on a 9-year downward trend since the influx of foreign employment started in 2007.