Foreign Worker Quota for the Construction Sector

Assoc Prof Fatimah Lateef asked the Acting Minister for Manpower whether the foreign worker quota for the construction sector can follow that set for the year in which the project is awarded and not the year of commencement of the project.

As part of our national drive towards more productivity-led manpower efficient growth, the Government has progressively reduced the Man-Year Entitlement (MYE) for the construction sector since 2010. The MYE reflects the quota of foreign workers allocated to a main contractor for a specific construction project. The table below shows the MYE reductions since 2010:

The MYE reductions were not implemented on an immediate basis. The MYE reductions took effect for MYE applications lodged after the date of each reduction.

The reason for pegging implementation to the date of MYE applications, that is, after the commencement of the projects, rather than date of contract award, was to encourage the industry to respond more quickly to the MYE reductions. Otherwise, the push for greater productivity in construction may be delayed for a longer period. In addition, the MYE reductions were phased out over four years, to allow the industry time to adjust. We also did not reduce the overall Dependency Ratio Ceiling (DRC) for the construction sector, taking into account the importance of ensuring the smooth completion of key infrastructure projects.

Together with the many Government assistance schemes to help companies build new capabilities, adopt technology, improve business processes and upgrade their workers, these MYE reductions are important to spur the transformation of the construction sector towards higher productivity and lower reliance on foreign manpower. The productivity level of our construction sector is about one-fifth below that of Hong Kong and South Korea, and even further below Japan and other international leaders. We must, therefore, continue to strongly encourage construction companies to reduce their overall reliance on manpower, but in a manner that does not delay critical public infrastructure projects that are already underway.