Given that COVID-19 uncertainties are still ongoing, it may be counterintuitive to think now may be a good time for you to plan for your 2021 team or expansion plans.
However, according to a recent news report, 1 in 5 employers in Singapore have plans to ramp up hiring in 2021, while 66% said they don’t have plans to adjust headcount.
If you’re undecided in your plans for hiring in 2021, here are 5 reasons why you should consider it.
#1 Take Advantage Of Higher Funding Level On Government Grants Till 3Q2021
One of the things that we’ve already heard and thought about is how business can use this slow period to strengthen. With some businesses running under capacities, this offers valuable down time to relook internal processes, onboard digital tools and upskill employees.
Even as majority of industries struggle with COVID-19, there are certain businesses that have greatly benefitted from the downturn as well. They include those in technology, e-commerce and healthcare. These business can similarly be heartened by the strong growth to also relook internal processes, onboard digital tools, upskills employees, and further – expand their teams.
Many government grants, including the Enterprise Development Grant (EDG), Productivity Solutions Grant (PSG), Enhanced Training Support Package (ETSP) and other are providing a higher level of funding into 2021.
If businesses do not tap on these grants from now till the higher level of funding expires some time between mid to end 2021, you will be missing the opportunities to leverage on heavy government support to boost your business.
#2 Jobs Growth Incentive (JGI) Coming To A Close In February 2021
Besides existing government grants, new schemes have also been put in place to provide a boost for businesses.
Announced in early September, the Jobs Growth Incentive (JGI) gives businesses 25% or 50% salary support for new Singaporean or PR employees hired between September 2020 and February 2021 for 1 year. Businesses will be given 25% salary support for eligible new employees under 40 years, while 50% salary support will be given for eligible new employees 40 years and above.
This will only apply to the first $5,000 in wages – which supports the hiring of entry level and mid-career switchers – as well as comes with the condition of businesses having to increase the local headcount.
For businesses that are seeing an uptick in growth, this becomes a great time to push forward hiring which may have been planned in phases.
For businesses that are confident but taking a wait-and-see approach, the salary support provides greater encouragement and makes expansion a slightly less risky prospect as the government shares in the cost.
#3 Jobs Support Scheme (JSS) Still Providing Support Until March 2021
The Jobs Support Scheme (JSS) was announced early in the COVID-19 downturn, helping businesses navigate the 7 April to 1 June Circuit Breaker period in Singapore. All businesses were provided with 75% salary support for the employees, up to a cap of $4,600 salary.
Without it, many more business would have suffered and employees potentially lose their jobs. The JSS was extended to cover local employees’ salary until March 2021, giving businesses the ability to recover from their COVID-19 downturn.
For businesses that are in a position to hire, you can tap on the Jobs Growth Incentive (JGI) as well as another layer of salary support through the JSS until March 2021 for new hires. The final JSS payout is in June 2021, providing salary support for the period between January to March 2021.
Companies in different tiers are provided varying levels of salary support.
|Month Of Payout||Payout Based On Wages Paid In||Tier 1||Tier 2||Tier 3|
|Apr 2020||Oct-Dec 2019||75%||50%||25%|
|Jul 2020||Feb-Mar 2020||75%||50%||25%|
|Apr 2020 (Circuit Breaker)||75%||75%||75%|
|Oct 20||May 2020 (Circuit Breaker)||75%||75%||75%|
(0% for sectors managing well)
#4 Make Hires On The SGUnited Skills & Training Package By 31 March 2021
The SGUnited Skills & Training Package was launched to help two main groups of potentially affected employees in the jobs market – 1) fresh graduates and 2) mid-career switchers. Targeted to create more than 100,000 opportunities, the SGUnited Skills & Training package has already created 123,000 openings and placed 60,000 jobseekers.
The programme is divided into two tracks – 1) SGUnited Traineeships and SGUnited Mid-Career Pathways.
Companies can offer SGUnited Traineeships to fresh graduates for up to 9 months with an allowance of up to $2,500, and they must commence by 31 March 2021. The government will co-fund 80% of the allowance.
These graduates must be citizens or PRs, and must have graduated from ITEs, polytechnics, universities or other education institutions in 2019 or 2020, or have graduated from these educational institutions earlier and completed National Service (NS) in 2019 or 2020.
Companies can also hire under the SGUnited Mid-Career Pathways Programme lasting up to 9 months. Mid-career training allowance can be between $1,400 to $3,000, and the government will fund 80% of it. These attachment opportunities must also start from 31 March 2021.
#5 Salary Expectations Possibly Still Depressed
While business sentiments may be improving, we cannot ignore the fact that there is an economic downturn in 2020 – the worst one on record for Singapore.
This has already led to a decrease in median wages for the first time since 2004, citizen unemployment rising to 4.9%, and a cut in working hours/work weeks.
This may result in lower salary expectations for those who have experienced the effects of the economic crash. However, businesses also have to realise that they are competing for the same talent if they wish to strengthen in key growth areas such as in digitalisation and technology functions.
Don’t Rush To Expand For The Sake Of It
For businesses that have hiring plans, these are the grants and schemes, and you should leverage on them as far as possible to build out your teams for 2021 and beyond. Being slightly more aggressive or pushing forward your hiring plans can be mitigated by sharing some of the costs with the government.
If your business does not have any hiring plans, you should still seriously consider whether it may be beneficial to expand your teams. Such heavy subsidies and sharing of costs to build your capabilities can be advantageous to growing the business for the longer-term. If you decide now is not the time, don’t push it either.
This is because we still don’t know what will be announced in Budget 2021. While it is clearly unlikely that it will provide as much support to businesses as the current schemes and grants, there may be newer/other support measures businesses can tap on to expand in the future.
Need Financing Support During This Period?
From now till 31 March 2021, SMEs can enjoy extra financing support of up to $5 million through the Temporary Bridging Loan Programme.
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