Dreaming of the expat life in Singapore? Why getting a job there will be tougher

Singapore is a permanent fixture on the “best places” list. It is the most peaceful country in the world. It’s also among the most liveable places, making it among a favourite destination for expats – the highest-ranked Asia, according to global consulting firm Mercer’s 2023 Quality of Living survey for expatriates. While many foreign workers have their eyes set on the city-state, getting a job in Singapore might just get tougher.

Come 2025, the government is tightening employment rules for foreign professionals. The minimum monthly salary for a new applicant, known as the employment pass, will be raised. This is likely to affect the number of expats coming to Singapore.

We take a look at what changes the Singaporean government is introducing in the wages of foreign workers and why.

Raising the minimum wage limit

Singapore is set to raise the salary threshold for foreign workers from next year, its government announced on Monday. Companies hiring foreign professionals will need to pay them higher minimum salaries so that they can qualify for work visas.

In January 2025, the minimum monthly salary for a new applicant to obtain the employment pass will be raised to 5,600 Singapore dollars (Rs 3.45 lakh), up from the current SG $5,000 (Rs 3.08 lakh), Singapore’s manpower minister Tan See Leng said in parliament on Monday.

The bar is higher for the financial services sector. Companies will have to pay recruits at least SG$ 6,200 (Rs 3.82 lakh) a month, which is up from SG$ 5,500 (Rs 3.39 lakh). This is keeping in mind the industry’s norms of higher salaries.

The minimum monthly salary for applicants in their mid-40s will increase to SG $10,700 (Rs 6.59 lakh), and up to SG $11,800 (Rs 7.27 lakh) for those in the financial services sector.

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Securing jobs for locals

The new changes to the salaries have been announced to create better and more job opportunities for locals.

“By regularly updating the qualifying salaries based on the set wage benchmarks, we ensure a level-playing field for locals,” Tan said in parliament. “The EP [employment pass] qualifying salary will also continue to increase progressively with age.”

Singapore has had a minimum salary threshold for employment passes. Over the years, it has tightened the criteria to assure employment opportunities for locals. The limit was last raised in September 2022, to SG $5,000 (Rs 3.08 lakh) from SG $4,500 (Rs 2.77 lakh).

The qualifying salary for applicants for the employment pass is based on the top one-third of salaries for local professionals, managers, executives and technicians. It rises for older workers, according to a report in Nikkei Asia.

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The impact on foreign workers

Singapore is heavily dependent on foreign workers . According to the manpower ministry, there were about 1.48 million foreign workers as of June, of which 197,300 held EPs, which employers must apply for. The population of the city-state stands at 5.9 million.

Now a change in the salary threshold is expected to affect global businesses that plan on hiring expats in the Southeast Asian financial hub.

While the new rules are to create more jobs for locals, the Singaporean government also wants to ensure the quality of foreign hires.

Singapore will continue to attract top talent to grow the economy and ensure that firms develop their local workforce and treat locals fairly, Tan said, according to the Strait Times.

Last year, Singapore also revamped its visa programme for foreigners. It introduced a new Overseas Network and Expertise (ONE) pass and raised the salary threshold for other categories of visas in its efforts to attract the best talent to the city-state, reports South China Morning Post (SCMP). Around 4,200 One Pass applicants were approved by January this year.

The government wants to focus on valued overseas professionals. To attract them, it has introduced the point-based criteria called COMPASS (Complementarity Assessment Framework) to evaluate the extent to which an EP candidate complements Singapore’s workforce, reports Nikkei Asia. This comes into effect in September.

All applicants will receive scores of 0, 10 or 20 across four foundational criteria: salary, qualifications, hiring company’s diversity and local staff ratio. To qualify for the employment pass, an applicant will need 40 points. EP applicants for 27 jobs in six industries – agri-tech, financial services, green economy, health care, infocomm technology and maritime – can earn up to 20 bonus points, the report says.

So yes, getting a job in Singapore will now come with challenges of its own. But if the city-state is not an option, then what?

Looking towards Japan

The answer probably lies in Japan. Tokyo comes a close second to Singapore, on the list of most livable cities in Asia for expats, according to a report by global mobility firm ECA.

The Japanese capital is clean and safe, it boasts great infrastructure and its cost of living is lower than other financial cities. It has introduced several child-friendly initiatives. Reforms are underway to boost Tokyo’s attractiveness as a financial hub. This includes taxation and other initiatives that encourage talented professionals to settle in the city for a long-term

David Shirt, CEO of investment advisory firm Astris Advisory Japan, told Reuters. “Tokyo is clean and safe, with world-class education and lots of international schools. And it’s affordable. People talk about low taxes in Singapore where rents are sky-high. Here, on the other hand, rents are lower and you get a world-class city to live in.”

That’s not all. Japan is introducing measures to retain foreign workers. The government has adopted plans to create a new system designed to train unskilled foreign workers and facilitate their attainment of medium- to long-term employment opportunities in the country, reports Japan Times. This is part of a broader strategy to address labour shortages.

The new initiative will help foreign individuals acquire the necessary skills in three years so that they can qualify for visas under the residency system for foreign nationals. Japan is set to accept up to eight lakh foreigners in the next five years, a source to Kyodo News.

The Japanese government has also eased visa regulations, expanding the scope of foreign students allowed to stay in the country and find jobs. This is expected to increase the number of foreign students staying back to 3,000 a year.

Japan’s population of 126 million is rapidly ageing and shrinking, and many industries like services, manufacturing and construction are facing shortages.

So while it might be difficult to live the Singaporean dream, Japan is opening its doors to the world.

With inputs from agencies