Monday, March 14, 2011

Singapore work pass salaries, foreigner intake and rents in 2011

Just after increasing foreign worker levy in the budget, Singapore government is also fast to increase minimum fixed monthly salary bar for S-Pass and Employment Pass holders in Singapore. From July 2011 an Employment Pass (EP) will be granted to minimum salary of 2,800 SGD, 300 SGD increase from current level of 2,500 SGD.

Minimum fixed monthly
Work Pass

Type of

Before 2011 After 2011
Pass P1
Professional, Managerial, Executive or Specialist jobs 7000 8000
Pass P2
Professional, Managerial, Executive or Specialist jobs 3500 4000
Pass Q1
Professional, Managerial, Executive or Specialist jobs 2500 2800
S-Pass mid-level skilled workers (i.e. technicians and retail
1800 2000

Fixed monthly salary refers to the total regular monthly payments to a foreign employee, including basic salary. According to Ministery of Manpower, the "fixed monthly salary" must not vary in quantum from month to month and must be paid to the foreign employee on a monthly basis, regardless of his performance.

According to The Straits Times, Manpower Minister Gan Kim Yong said:

"We need to raise the qualifying thresholds for Employment Pass and S-Pass applicants accordingly to keep pace with the local PMETs, and encourage companies to be more selective in hiring foreign talent."

These measures will make "foreign talent" more expensive and will make companies to consider locals over foreigners. This will also decrease the number of foreigners coming to work and live in Singapore.
This is a bad news for companies who intend to hire foreigners and foreigners who would like to work in Singapore. But for people already in Singapore, it will have positive results. I am very interested in the effects of these changes to rental prices in Singapore. Foreigners are very important for Singapore rental demand since 80% of the local population have their own flats. Now, take a look at the paragraph from The Straits Times (same news article):
"The number of Employment Pass holders has jumped by more than 20 per cent in the past year, from 115,000 in 2009, to 142,000 last year. For S-Pass holders, the number rose from 82,000 to 98,000."
The numbers are astonishing and very well inline with growth rate of 2010. It is not hard to see what was fueling the rents last 2 years. 43,000 new foreigner families more in a single year! Actually much more. We should also consider 29,000 PR approvals because these are no more EP or S-Pass holders but still in the island. Assuming a family of 3 for these 29,000 approvals, and add around 9000 families more. In 2010, 52,000 new rental unit demand emerged.

We have already written about the possibility of rental price correction in Singapore in 2011 due to increased rental unit supply. In 2011, demand outlook also looks weaker with slower growth and these new salary threshold will decrease the demand.

This is also good news for local PMETs since their salaries may increase at the end:

Association of Small and Medium Enterprises (SMEs) president Lawrence Leow said it could also lead to the salaries of locals going up, as companies would have to adjust the pay of their existing staff. 
“If I have a local worker who has worked with me for two years and he earns $2,000, and I hire a new S-Pass holder at the same salary, it’s only right to increase his pay to reflect his working experience,” he said. 
While Mr Gan stressed that the Government has and will continue to “tilt the balance in favour of local PMETs”, he cautioned against closing the door on foreigners. 
“Foreign talent continues to be critical for our growth and these talents will help grow the economic pie, so that everyone will have a bigger share. Otherwise we will lose our attractiveness as an investment destination and we will not be able to create good jobs for locals.”
Source: The Straits Times


  1. Hello Sir,
    My Name is Ronit Tiwari and I want to S-pass visa in singapore. I had finished my Graduation with Economics Subject. So plz suggest me what should I do to get this type of visa.

  2. hi Ronit,
    To get s-pass you need to find an employer in Singapore who will give you a job and apply for s-pass visa for you. You cannot apply for work visa and then find a job. Some come here on tourist visa and look for job but this is a very expensive option.

  3. how about a permit from EPEC. i got one? can i apply for E-pass immediately or need to look for work still?

  4. Gabeleda,

    Only an employer can apply for Employment Pass for you. EPEC just lets you stay 6 months and look for a job in Singapore. I know some people who has opened up a company and then issue an EP for themselves in Singapore but they were already on EP with another company when they did so. But these people really had a business to do, they did not open the business for the sake of EP. I do not know EPEC can do that.