The reality for SMEs is harsh: With rocky times ahead, they have to rethink their operations, consolidate, merge, relocate or even pack up.
This is what Mr Chan Chong Beng, President of the Association of Small and Medium Enterprises (ASME) has said, in a response to the Budget statement recently delivered.
Speaking to reporters at a seminar on fair employment practices, Chan cited the Government’s tightening of foreign labour as a major setback for SMEs, as they continue to face difficulties coping with the current labour crunch.
However, Chan added that companies which are doing well will benefit from some of the new measures that will be implemented.
Commenting on the $3.6 billion Wage Credit Scheme, which the Government will co-fund 40 per cent of wage increases for Singaporean employees earning up to a gross monthly wage of $4000 over the next three years, Chan said that reactions to the scheme are mixed, based on feedback from SMEs. He said that those who are in the process of handing increments to their workers will find it helpful, while those who are already struggling with their business will find it a hindrance and be pressured, as their workers will demand a wage increase from their employers.
Chan suggested fair employment practices as a way for SMEs to retain workers.