Impact of Increased Varsity Places on Job Market, Value of Singapore Degrees and Median Salaries

This is an important question to address. In 2010, the Economic Strategies Committee concluded that skills, innovation and productivity must form the basis to sustain Singapore's economic growth. As we shift towards productivity and innovation-driven growth, we will create more higher value jobs that will require Singaporeans to have more knowledge, skills and experience. We are already seeing this today as Professionals, Managers and Executives (PMEs) make up about one in three resident workers, the fastest growing segment of Singapore’s resident workforce.1

This growing demand for highly skilled workers is not just a local trend, but a global one. According to a recent report by the McKinsey Global Institute2, there could be a global shortage of 16 million to 18 million college-educated workers in 2020.

Therefore, we should support a higher publicly-funded university cohort participation rate (CPR). With or without Government support, Singaporeans aspire to upgrade. Last year, nearly half (46%) of our resident labour force aged 25-29 years had attained a degree, higher than what is provided through our publicly-funded full-time places, as some obtained their degrees from private or overseas institutions. In this light, MOE’s plan to increase CPR to 40% will provide Singaporeans with more opportunities to access a publicly-subsidised degree education.

This is not just a paper chase. To ensure the value of higher education, the universities need to prepare students for work by imparting hard and soft skills relevant to current and future industry needs, while continuing to strengthen foundations and build analytical skills. Differentiation of the university landscape can also create more pockets of excellence. We have already done well in developing good research-oriented universities. The introduction of more applied, practice-oriented degrees at SIT and UniSIM will provide a differentiated pathway, one with close linkages to industry as graduates will be equipped with industry-relevant practical skills. The value of such graduates will be their keen understanding of industry, good industry networks and their work-readiness.

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It is difficult to project wage growth but if we are able to keep the labour market tight and to ensure that productivity grows, we should be able to see positive real wage growth over time.

I would like to end by making a few important observations. Clearly, Singaporeans today have aspirations for good jobs and good wages. We need to note that the increasing numbers of degree holders mean that more Singaporeans have been able to better themselves compared to their parent's generation. It also means that the playing field is more level and competitive for all. In order to meet these aspirations, we need to be able to grow jobs that pay well. Therefore, we need good companies, both local and foreign to be here. A diverse workforce remains an important feature in attracting good companies to be based in Singapore. We are committed to increasing the opportunities for Singaporeans to better themselves and we are committed to creating higher paying jobs for all.

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