Restarting Singapore’s Economy: 5 Takeaways From PM Lee’s May Day 2020 Speech

For the first time, Prime Minister Lee Hsien Loong’s May Day Rally was broadcast on television and streamed via social media channels.

It has been nearly a month since the “Circuit Breaker” was imposed, and Singapore is down to about 10 to 15 new community cases daily.

At the same time, COVID-19 measures have taken a toll on the world’s economy, with the IMF predicting the steepest decline of the global gross domestic product since the Great Depression in the 1930s.

Here are 5 important takeaways from Prime Minister Lee’s May Day address, as he sought to allay concerns and chart a vision for the future

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#1 Singapore’s Economy Will Open Up Slowly Even After Circuit Breaker Ends

As we look forward to the circuit breaker measures being eased, PM Lee emphasised that restarting the economy will not be straightforward. To prevent infections from flaring up again, the rest of the economy will have to open up step by step, and not all at once. 

Certain industries may open up earlier and recover sooner. Industries that are critical in keeping our domestic economy going, and those that keep us connected to the world and global supply chains. 

Sectors that draw huge crowds or involve close contact with others, such as entertainment outlets and large-scale sporting events, will have to wait.

#2 Employers Should Make Every Effort To Keep Their Workers 

PM Lee has encouraged businesses to take a longer-term view and make an effort to retain workers. Companies should not ‘drop workers at the first sign of trouble’. By treating workers well during this crisis, it helps to strengthen employee loyalty and puts the company in a better position to rebuild when the economy recovers.

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#3 Workers Need To Be Prepared To Accept Pay Cuts

The Government has tapped on reserves to save jobs and reduce costs for companies.

The Job Support Scheme has been enhanced to support companies of all sectors, paying 75% of the first $4,600 of wages. While this has helped companies to retain their local employees, businesses still have other costs to bear.

Thus, it is inevitable that workers will see pay cuts, either due to lost overtime or direct wage reductions, to keep businesses going.

#4 Govt Determined That Singapore Airlines Will See Through The Crisis

Air transport is important in Singapore’s strategic role as a global and regional hub. Thus, it calls for extra support to support the national carrier, which has been severely hit. In the fight against COVID-19, Singapore Airlines has assisted in flying in essential supplies and mounted evacuation flights to bring Singaporeans home. 

While most SQ flights remain grounded, its cabin crew have doubled up as care ambassadors in hospitals and safe distancing ambassadors in trains and markets.

As the airline faces its biggest crisis ever, PM Lee said during his May Day speech that ‘the government is determined that SIA will see through this crisis’.

#5 Being Prepared For Major Structural Changes In The Economy

After circuit breaker ends, Singapore will not return to status quo ante. We can expect to see significant structural changes to our economy, as countries rely less on imports for food and essential items. 

Industries will be disrupted permanently, forcing companies to change business models, while some jobs may just disappear. But there are also opportunities emerging from this crisis. Workers are learning to work from home; students are getting used to online learning. 

Relevant industries are growing, such as medical services, biotech, food production and delivery, and IT. Such sectors are seeing stronger demand and are open to hiring. As Singapore builds up her expertise in new areas, the Government is ready to help retrain workers for new jobs on a large scale with SkillsFuture Programmes. 

NTUC has set up the Job Security Council, to help match and train displaced workers for new job positions. More help will be given to freelancers, providing them with a buffer against economic volatility in such economic volatility.

Adapting To The Post-COVID-19 World

While Singapore is not alone in adapting to the post-Covid-19 world, our nation’s challenges are more unique because it is small and globalised. “The road to recovery will be long and hard,” PM Lee said. “We will not be under the illusion that all will be well the moment the circuit breaker period ends or when the number of infections comes down.”

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